Opinion
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
APPEAL from a judgment of the Superior Court of San Diego County, Richard Y. Montes, Judge, Super. Ct. No. GIC857389
IRION, J.
The City of San Diego (hereafter San Diego or the City) appeals from an adverse summary judgment ruling in a declaratory relief action brought by former San Diego Mayor Richard Murphy and former City Council members Ralph Inzunza and Michael Zucchet. The City challenges the trial court's ruling (1) that the City is obligated, pursuant to Government Code section 995, to provide Murphy, Inzunza and Zucchet with a defense to a lawsuit that the city attorney filed against them; and (2) that the City must pay Murphy, Inzunza and Zucchet the attorney fees and costs that they incurred in litigating this action. The underlying lawsuit filed by the City against Murphy, Inzunza and Zucchet challenged the validity of ordinances that impact the pension benefits that Murphy, Inzunza, Zucchet and other elected officers of the City will be entitled to collect upon retirement.
All further statutory reference are to the Government Code unless otherwise specified.
As we will explain, the City ultimately voluntarily dismissed the underlying lawsuit against Murphy, Inzunza and Zucchet that challenged the validity of the ordinances impacting the pension benefits available to the City's elected officers. Our opinion in this case does not examine the validity of the challenged ordinances. Instead, in this case we examine only whether the City is obligated to provide a defense to Murphy, Inzunza and Zucchet.
As we will explain, we conclude that the trial court properly granted summary judgment in favor of Murphy, Inzunza and Zucchet, ruling that the City was obligated to provide them with a defense. We also conclude that the trial court did not abuse its discretion in awarding to Murphy, Inzunza and Zucchet the attorney fees and costs they incurred in this action pursuant to section 800. However, we conclude that the trial court did not properly apply the standards set forth in section 800, because it did not limit the award of attorney fees to reasonable fees computed at $100 per hour and a total fee amount of no more than $7,500. Therefore, we vacate the portion of the judgment concerning the award of attorney fees incurred in this action, and we remand for the trial court to apply the standards set forth in section 800 in making the fee award.
I
FACTUAL AND PROCEDURAL BACKGROUND
A. The Lawsuit Against Murphy, Inzunza and Zucchet
Murphy was San Diego's mayor from December 2000 to July 2005. Inzunza was a member of the City Council from March 5, 2001, to July 25, 2005, and Zucchet was a member of the City Council from December 2, 2002, to July 25, 2005.
In September 2005 San Diego's city attorney (the City Attorney), on behalf of the City, filed a lawsuit against Murphy, Inzunza and Zucchet in San Diego County Superior Court, case No. GIC854373 (the Lawsuit). The Lawsuit challenged certain ordinances that impacted, among other things, the pension benefits that Murphy, Inzunza, Zucchet and other past and present elected officers of the City may collect upon retirement.
1. Ordinances Challenged in the Lawsuit Against Murphy, Inzunza and Zucchet
The ordinances challenged in the Lawsuit were adopted between September 2000 and December 2002.
First, in September 2000 the City Council adopted an ordinance amending San Diego Municipal Code section 24.1705 to lower the retirement age for elected officers from 60 to 55. The Lawsuit alleged that this ordinance was unauthorized because it was enacted without a vote of the electorate.
The Lawsuit alleged that a vote of the electorate was required to approve the enactment because it allegedly conflicted with a specification in the City's charter of age 62 as the age at which an employee became eligible to retire, and the California Constitution requires that any changes to a city's charter be made through a vote of the people. (Citing Cal. Const., art. XVI, § 18.)
Second, also in September 2000 the City Council adopted an ordinance amending San Diego Municipal Code section 24.0546 by changing the formula used for calculating the amount of pension benefits payable to retired elected officers. The Lawsuit alleged that this amendment violated the City's charter and the California Constitution because it was made without providing an adequate funding source. Neither Murphy, Inzunza nor Zucchet were members of the City Council in September 2000 when these ordinances were passed.
Specifically, the Lawsuit alleged that the formula was changed from " '5% of the first $500/month compensation plus 3% of any additional monthly compensation' to '3.5% of total monthly compensation.' "
Third, in October 2001 the City Council adopted Ordinance No. 0-18994, which added the City Attorney to the list of officers eligible to participate in the pension plan. The Lawsuit alleged that the ordinance should have been put to a vote of the electorate and, further, that it was impermissibly enacted without a funding source, in violation of the City's charter and the California Constitution. Zucchet was not a council member at the time this ordinance was adopted. Inzunza was a member of the City Council, but he was not present for the vote. Murphy voted to adopt the ordinance.
According to the Lawsuit, a vote of the electorate was necessary for the same reason that a vote was necessary when the retirement age of the other elected officers was lowered to 55, i.e., a retirement age of 55 allegedly conflicted with the City's charter.
Fourth, in January 2002 the City Council adopted Ordinance No. 0-19022, which retroactively extended the pension benefit increases enacted in September 2000 to elected officers who were in office before September 2000. The Lawsuit alleged this ordinance was impermissible because it was enacted without providing a funding source, in violation of the City's charter and the California Constitution. Zucchet was not a council member at the time this ordinance was adopted, but Murphy and Inzunza voted to adopt the ordinance.
Fifth, in December 2002 the City Council adopted an ordinance that amended the San Diego Municipal Code to allow City employees to purchase up to five years of pension credits that would count toward the years of employment required before pension benefits could vest. The Lawsuit alleged that this ordinance should have been put to a vote of the electorate because it conflicted with a provision of the City's charter. Murphy, Inzunza and Zucchet all voted to adopt the ordinance.
2. Causes of Action Alleged in the Lawsuit and Relief Sought
The Lawsuit alleged three causes of action.
The first cause of action sought declaratory relief to establish that the above-described ordinances are void because they were enacted without a funding source or violated the City's charter. In connection with the declaratory relief cause of action, the Lawsuit stated that Murphy, Inzunza and Zucchet were "purportedly eligible to begin receiving [pension] benefits," and "[w]ithout a judicial declaration that the ordinances . . . are null and void, [Murphy, Inzunza and Zucchet] will begin collecting the unlawful and improper benefits, thereby exacerbating the current pension deficit and exposing the City to increased debt."
The second cause of action alleged that, by voting in favor of ordinances increasing their pension benefits, Murphy and Inzunza violated section 1090, which provides that "city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members," and that the enactments should therefore be voided.
The third cause of action alleged that, by voting in favor of ordinances increasing their pension benefits, Murphy, Inzunza and Zucchet violated section 87100, which provides: "No public official at any level of state or local government shall make, participate in the making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest." The third cause of action alleged that because of the violation of section 87100 the ordinances should be set aside as void. The third cause of action also alleged that a public official who realized an economic benefit as a result of a violation of section 87100 is liable "for an amount up to three times the value of the benefit."
The Lawsuit specifically prayed for (1) a declaration that Murphy, Inzunza and Zucchet were without authority to adopt the ordinances; (2) a declaration that Murphy, Inzunza and Zucchet "are not permitted to collect retirement benefits that are declared unlawful"; (3) costs of suit and attorney fees; and (4) "other such legal or equitable relief as the Court may deem just and proper."
Although the Lawsuit only requests a declaration that Murphy, Inzunza and Zucchet not be permitted to collect any pension benefits declared to be unlawful, the Lawsuit includes a long list of former and current elected officers who benefited from the challenged ordinances. These individuals also would be impacted if the ordinances were declared unlawful.
B. The City Declines to Provide Murphy, Inzunza and Zucchet with a Defense of the Lawsuit
On September 30, 2005, shortly after the Lawsuit was filed, Murphy, Inzunza and Zucchet sent a letter to the City, requesting that the City provide them a defense to the Lawsuit. The letter cited section 995, which provides in relevant part: "Except as otherwise provided in Sections 995.2 and 995.4, upon request of an employee or former employee, a public entity shall provide for the defense of any civil action or proceeding brought against him, in his official or individual capacity or both, on account of an act or omission in the scope of his employment as an employee of the public entity."
"The duty to provide employees with a defense in civil actions is mandatory, unless one of the exceptions included in sections 995.2 and 995.4 exists." (Stewart v. City of Pismo Beach (1995) 35 Cal.App.4th 1600, 1605.) A public entity that agrees to provide a defense under section 995 may do so by its own attorney or through outside counsel. (See § 996 ["A public entity may provide for a defense pursuant to this part by its own attorney or by employing other counsel for this purpose or by purchasing insurance which requires that the insurer provide the defense"].)
The City Attorney prepared a report to the City Council regarding Murphy, Inzunza and Zucchet's request. Among other things, the report explained the exceptions to section 995's defense obligation, as set forth in sections 995.2 and 995.4. Section 995.2 provides in relevant part:
"(a) A public entity may refuse to provide for the defense of a civil action or proceeding brought against an employee or former employee if the public entity determines any of the following:
"(1) The act or omission was not within the scope of his or her employment.
"(2) He or she acted or failed to act because of actual fraud, corruption, or actual malice.
"(3) The defense of the action or proceeding by the public entity would create a specific conflict of interest between the public entity and the employee or former employee. For the purposes of this section, 'specific conflict of interest' means a conflict of interest or an adverse or pecuniary interest, as specified by statute or by a rule or regulation of the public entity."
Section 995.4 provides:
"A public entity may, but is not required to, provide for the defense of:
"(a) An action or proceeding brought by the public entity to remove, suspend or otherwise penalize its own employee or former employee, or an appeal to a court from an administrative proceeding by the public entity to remove, suspend or otherwise penalize its own employee or former employee.
"(b) An action or proceeding brought by the public entity against its own employee or former employee as an individual and not in his official capacity, or an appeal therefrom."
The City Attorney's report concluded that the City was not required to provide a defense. Although it did not specifically identify which of the exceptions set forth in sections 995.2 and 995.4 were applicable, the City Attorney's report appears to have relied on section 995.2, subdivision (a)(3) (i.e., the exception that applies when the provision of a defense would create a specific conflict of interest) and section 995.4, subdivision (a) (i.e., the exception that applies to a proceeding to remove, suspend or otherwise penalize an employee or former employee). The report stated: "Because the City is a plaintiff in the action against former officials, an inherent conflict of interest exists. The action, which seeks to prevent the collection of the retirement benefits granted in violation of the City charter and California Constitution, is essentially a penalty for failing to perform their obligations and duties. Accordingly, the City is not required to provide a defense to these former elected officials under these circumstances." (Italics added.)
At an October 17, 2005 meeting, the City Council addressed Murphy, Inzunza and Zucchet's request for a defense of the Lawsuit. A representative of the City Attorney's Office addressed the City Council, along with an attorney representing Murphy, Inzunza and Zucchet. Four members of the City Council voted in favor of providing a defense, and two members voted in opposition. Because a vote of at least five members was necessary to approve the request for a defense, the request was not approved.
After the motion to approve the request failed to pass by the required number of votes, one member of the City Council (who had voted in favor of granting the request) suggested that the City Council make a finding that the request to provide a defense to Murphy, Inzunza and Zucchet was being denied under section 995.2, subdivision (a)(3) because providing a defense would create a conflict of interest. Despite this motion, the City Council did not make a finding to explain the basis on which it denied a defense to Murphy, Inzunza and Zucchet.
In a letter from San Diego's city manager dated October 19, 2005, the City officially denied Murphy, Inzunza and Zucchet's request for a defense. The letter stated that "[t]he Council voted 4 to 2 in favor of providing a defense. However, because the action required at least five votes to pass, your request is hereby denied."
C. The Proceedings in This Action
On November 23, 2005, Murphy, Inzunza and Zucchet filed this action, seeking a declaration that the City is obligated to provide them with a defense of the Lawsuit pursuant to section 995. In addition, Murphy, Inzunza and Zucchet sought recovery of the attorney fees and costs that they had expended in bringing this action. In support of their request for fees and costs, they cited section 800 and Code of Civil Procedure section 128.5.
Murphy, Inzunza and Zucchet then proceeded to defend against the Lawsuit at their own expense. They filed a demurrer to the Lawsuit and on December 16, 2005, received a tentative ruling in their favor in which the court requested further briefing on whether the Lawsuit should be dismissed with or without leave to amend the complaint. The City filed a voluntary dismissal of the Lawsuit on January 3, 2006.
In this action, on February 23, 2006, Murphy, Inzunza and Zucchet filed a motion for summary judgment, arguing that there was no dispute as to the relevant facts and that the City was legally obligated to provide them with a defense of the Lawsuit and to pay their attorney fees and costs in this action. In support of their motion, Murphy, Inzunza and Zucchet submitted various documents, including (1) a copy of the Lawsuit; (2) copies of the relevant City ordinances; (3) minutes and a transcript of the October 17, 2005 City Council meeting during which the City denied their request for a defense of the Lawsuit; (4) the City Attorney's report to the City Council in connection with the request for a defense; and (5) evidence that the City voluntarily dismissed the Lawsuit after the unfavorable tentative ruling on the demurrer.
The City opposed the motion, arguing among other things (1) that various exceptions set forth in sections 995.2 and 995.4 apply to this case, relieving the City of the obligation to provide a defense to the Lawsuit; (2) that Murphy, Inzunza and Zucchet are barred from obtaining payment for the cost of defending the Lawsuit because they did not file a claim for money damages with the City under section 905; and (3) that the summary judgment motion was premature because the City was attempting to take Murphy's deposition in another lawsuit related to the City of San Diego's pension crisis, which allegedly would have some bearing on the issue of whether the City was obligated to provide Murphy, Inzunza and Zucchet with a defense to the Lawsuit.
The trial court granted the motion for summary judgment. It ruled that pursuant to section 995 the City was obligated provide Murphy, Inzunza and Zucchet with a defense to the Lawsuit. Further, it awarded Murphy, Inzunza and Zucchet the attorney fees and costs of suit they incurred in this action, although it did not expressly indicate the statutory provision under which it made the award.
The City filed this appeal.
II
DISCUSSION
A. Applicable Legal Standards
A trial court decides a summary judgment motion by determining (1) whether the parties have met their respective burdens of production, and (2) ultimately whether the moving party has met its burden of persuasion. (See Code Civ. Proc., § 437c, subd. (p)(1); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850 (Aguilar).) With respect to the parties' respective burdens of production, a "party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact." (Aguilar, at p. 850.)
Here, the plaintiffs (i.e., Murphy, Inzunza and Zucchet) were the moving parties. A plaintiff may move for summary judgment to establish "that there is no defense to the action or proceeding." (Code Civ. Proc., § 437c, subd. (a).) A plaintiff meets its initial "burden of showing that there is no defense to a cause of action" when it "has proved each element of the cause of action entitling the party to judgment on that cause of action." (Id., subd. (p)(1).) "[S]ummary judgment law in this state no longer requires a plaintiff moving for summary judgment to disprove any defense asserted by the defendant as well as prove each element of his own cause of action." (Aguilar, supra, 25 Cal.4th at p. 853.)
With respect to the defendant's burden of production, "[o]nce the plaintiff . . . has met [its] burden, the burden shifts to the defendant . . . to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto." (Code Civ. Proc., § 437c, subd. (p)(1).) When a plaintiff moving for summary judgment has met its initial burden of production, "[t]he defendant . . . may not rely upon the mere allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to that cause of action or a defense thereto." (Ibid.)
The City's appellate briefing misstates the applicable burden of production. Mistakenly referring to the burden of production that applies when the defendant is the moving party, the City states that "the moving party must satisfy the court that it has identified every issue raised by the pleadings and then it must show that the opponent 'could not have prevailed on any theory raised by the pleadings.' " (Italics added, citing Hawkins v. Wilton (2006) 144 Cal.App.4th 936, 939-940.)
Ultimately, the moving party "bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law." (Aguilar, supra, 25 Cal.4th at p. 850.) "[I]f a plaintiff who would bear the burden of proof by a preponderance of evidence at trial moves for summary judgment, he must present evidence that would require a reasonable trier of fact to find any underlying material fact more likely than not . . . ." (Id. at p. 851, italics omitted)
We review a summary judgment ruling de novo to determine whether there is a triable issue as to any material fact and whether the moving party is entitled to judgment as a matter of law. (Certain Underwriters at Lloyd's of London v. Superior Court (2001) 24 Cal.4th 945, 972.) "In practical effect, we assume the role of a trial court and apply the same rules and standards which govern a trial court's determination of a motion for summary judgment." (Lenane v. Continental Maritime of San Diego, Inc. (1998) 61 Cal.App.4th 1073, 1079.)
B. Murphy, Inzunza and Zucchet Met Their Burden of Proof and Persuasion to Establish that the City is Obligated to Provide Them with a Defense
In their motion for summary judgment, Murphy, Inzunza and Zucchet argued that the undisputed facts established that they are entitled to a declaration that the City is obligated to provide them with a defense to the Lawsuit under section 995.
Section 995 provides that "[e]xcept as otherwise provided in Sections 995.2 and 995.4, upon request of an employee or former employee, a public entity shall provide for the defense of any civil action or proceeding brought against him, in his official or individual capacity or both, on account of an act or omission in the scope of his employment as an employee of the public entity."
The basic requirements set forth in section 995 are clearly met in this case and are not disputed by the City on appeal. As is clear from the evidence in the record, Murphy, Inzunza and Zucchet are all former employees of the City, and the Lawsuit was brought against them "on account of an act or omission in the scope of [their] employment." (§ 995.) Specifically, the Lawsuit targets the legality of votes made by Murphy, Inzunza and Zucchet while they were members of the City Council.
However, the City argues that it is not obligated to provide a defense to Murphy, Inzunza and Zucchet because two of the exceptions set forth in sections 995.2, subdivision (a)(3) and 995.4, subdivision (a) apply. As we will explain, we reject the City's contention as to both of those exceptions.
1. The Applicability of the Exception Set Forth in Section 995.2, Subdivision (a)(3)
The first exception cited by the City appears in section 995.2, subdivision (a)(3). According to that provision, "[a] public entity may refuse to provide for the defense of a civil action or proceeding brought against an employee or former employee if the public entity determines [t]he defense of the action or proceeding by the public entity would create a specific conflict of interest between the public entity and the employee or former employee." (§ 995.2, subd. (a)(3).) In the context of section 995.2, " 'specific conflict of interest' means a conflict of interest or an adverse or pecuniary interest, as specified by statute or by a rule or regulation of the public entity." (Id., subd. (a)(3).)
In their motion for summary judgment, Murphy, Inzunza and Zucchet argued that this exception did not apply because the City did not, as required by section 995.2, make a determination that a specific conflict of interest would be created if it agreed to defend the Lawsuit. We conclude that this argument has merit.
The plain language of section 995.2 states that the exception described therein applies "if the public entity determines" that a conflict of interest would be created. (Id., subd. (a).) In support of their motion for summary judgment, Murphy, Inzunza and Zucchet submitted evidence to establish that the City did not make a determination that it would create a conflict of interest to provide them with a defense to the Lawsuit. Specifically, the transcript of the October 17, 2005 City Council meeting shows that the City Council expressly considered making such a determination but declined to do so. Through this evidence, Murphy, Inzunza and Zucchet met their burden to show that the exception set forth in section 995.2, subdivision (a)(3) did not apply because there was no determination that a conflict of interest would be created.
Although the City did not make the argument to the trial court, it argues for the first time on appeal that although the City Council did not make the necessary determination that a conflict of interest would be created, the City Attorney had the authority to make that determination and in fact did make such a determination in his report and through comments made by a representative of the City Attorney's Office at the October 17, 2005 City Council meeting. We reject the City's argument on two separate grounds.
First, because the City has raised this argument for the first time on appeal, it submitted no evidence in support of its position when it filed its opposition to the motion for summary judgment. Thus, the record contains no evidence to create a triable issue of fact as to whether the City Attorney was authorized to make a determination, on behalf of the City, that providing a defense of the Lawsuit would create a conflict of interest.
Indeed, the only evidence in the record is to the contrary. The transcript of the October 17, 2005 City Council meeting shows that the City Council was considering making such a determination itself, and the City Attorney at the time evidently agreed that the City Council should make the determination. When one of the council members proposed that the City Council make a determination that providing a defense to the Lawsuit would create a conflict of interest, a representative of the City Attorney's Office agreed, stating, "I think it would be a wise decision for the Council to make the finding that there is a conflict of interest."
In the absence of any evidence in the record that the City Attorney has the authority to make the determination required by section 995.2, we are bound to follow "the familiar rule that 'possible theories not fully developed or factually presented to the trial court cannot create a "triable issue" on appeal.' " (North Coast Business Park v. Nielsen Construction Co. (1993) 17 Cal.App.4th 22, 31, italics omitted.) We therefore conclude that the City failed to meet its burden of production to show that a triable issue of fact exists as whether the City, through the City Attorney, made the determination required by section 995.2.
Second, as an additional basis for rejecting the City's position, we note that the City's separate statement of facts filed in opposition to the summary judgment motion did not assert that the City Attorney had the authority to make the determination required by section 995.2. Although Murphy, Inzunza and Zucchet's separate statement of facts asserted that "[t]he City Council has never determined, in accordance with . . . section 995.2, that any of the exceptions to . . . section 995 apply and thereby justify its refusal to pay for [Murphy, Inzunza and Zucchet's] defense to the [Lawsuit]," the City's own separate statement did not dispute this fact and, more importantly, did not assert that the City Attorney had the authority to make the necessary determination. "A party waives a new theory on appeal when he fails to include the underlying facts in his separate statement of facts in opposing summary judgment." (City of San Diego v. Rider (1996) 47 Cal.App.4th 1473, 1493.) Applying this principle, we conclude that the City waived its ability to argue on appeal that a triable issue of fact exists as to whether the City Attorney had the authority to make the determination required by section 995.2.
The City also argues that the existence of the Lawsuit itself establishes that it made a determination, as required by section 995.2, that providing a defense to Murphy, Inzunza and Zucchet would create a conflict of interest. Specifically, the City points out that the Lawsuit contains a cause of action entitled "Conflict of Interest" asserted under section 1090. The City argues, "The second cause of action is entitled 'conflict of interest[.]' How much clearer can it be?" We reject this argument as fallacious.
The conflict of interest described in the Lawsuit concerns the alleged conflict presented when Murphy, Inzunza and Zucchet voted on pension issues that would personally impact them, allegedly in violation of the provision that "city officers or employees shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members." (§ 1090.) In the context of section 995.2, in contrast, the question is whether a conflict of interest would be created if the City paid to defend Murphy, Inzunza and Zucchet in the Lawsuit. Because the Lawsuit alleges a completely different type of conflict of interest than required by section 995.2, the presence of a cause of action entitled "Conflict of Interest" in the Lawsuit does not constitute the determination required by section 995.2
We thus conclude that Murphy, Inzunza and Zucchet carried their burden of production and their burden of persuasion to establish that the exception set forth in section 995.2, subdivision (a)(3) does not apply because the City did not make a determination that providing a defense to Murphy, Inzunza and Zucchet would create a conflict of interest.
Because we determine that the exception does not apply on the ground that no determination was made, we need not and do not decide whether a conflict of interest would have been created within the meaning of section 995.2 if the City had decided to provide a defense to Murphy, Inzunza and Zucchet.
2. The Applicability of the Exception Set Forth in Section 995.4, Subdivision (a)
The City also argues that it is not obligated to provide a defense to Murphy, Inzunza and Zucchet because of the exception set forth in section 995.4, subdivision (a). According to that exception, "[a] public entity may, but is not required to, provide for the defense of: [¶] (a) An action or proceeding brought by the public entity to remove, suspend or otherwise penalize its own employee or former employee, or an appeal to a court from an administrative proceeding by the public entity to remove, suspend or otherwise penalize its own employee or former employee." (§ 995.4, subd. (a).) The City argues that the Lawsuit sought to penalize Murphy, Inzunza and Zucchet, within the meaning of section 995.4, subdivision (a).
Unlike section 995.2, section 995.4 does not require that the City make a determination that the exception applies. Instead, the plain language of the statute indicates that the exception will apply whenever the described circumstance exists.
As an initial matter we note that City's appellate briefing on this issue is sufficiently inadequate that we could decline to consider the argument. The City's argument is not supported by any citation to authority or any citation to the record. The substance of the City's argument consists of a single unsupported statement: "[T]he undisputed evidence is that [the City] brought an action against former employees to impose penalties upon them." "An appellate court is not required to examine undeveloped claims, nor to make arguments for parties" (Paterno v. State of California (1999) 74 Cal.App.4th 68, 106); its role is to evaluate " 'legal argument with citation of authorities on the points made.' " (People v. Stanley (1995) 10 Cal.4th 764, 793; see also Wright v. City of Los Angeles (2001) 93 Cal.App.4th 683, 689 ["Generally, asserted grounds for appeal that are unsupported by any citation to authority and that merely complain of error without presenting a coherent legal argument are deemed abandoned and unworthy of discussion"].) Under these principles, we have the discretion to choose not to address the City's argument.
We note also that the City did not take the position in the trial court that the Lawsuit was an action to penalize Murphy, Inzunza and Zucchet.
However, we will exercise our discretion to consider the merits of the City's argument that the Lawsuit constitutes an attempt to penalize Murphy, Inzunza and Zucchet within the meaning of section 995.4, subdivision (a). As we will explain, we reject the City's argument.
Focusing on the relief sought in the Lawsuit, it is clear that the Lawsuit cannot fairly be characterized as an action to penalize Murphy, Inzunza and Zucchet. Instead, the relief sought by the Lawsuit was a judicial declaration to establish the invalidity of the challenged ordinances, which impact numerous current and former city officials, 35 of whom (not including Murphy, Inzunza and Zucchet) were identified in the body of the Lawsuit. Although the prayer for relief in the Lawsuit also seeks a declaration that Murphy, Inzunza and Zucchet "are not permitted to collect retirement benefits that are declared unlawful by way of this lawsuit" (italics added), Murphy, Inzunza and Zucchet would not have been impacted unless the Lawsuit had succeeded in its main goal, i.e., obtaining a declaration invalidating the challenged ordinances. Because the prayer seeking a declaration as to Murphy, Inzunza and Zucchet was only incidental and subsidiary to the main relief sought, the Lawsuit cannot be characterized as aimed at imposing a penalty on Murphy, Inzunza and Zucchet. (Cf. County of Marin Assn. of Firefighters v. Marin County Employees Retirement Assn. (1994) 30 Cal.App.4th 1638, 1654 [lawsuit does not seek a statutory penalty within the meaning of Code Civ. Proc., § 340 when the item alleged to constitute a penalty is only " 'a mere incident' " to the main relief sought].)
As we have explained, we are not called upon in this case to rule on the validity of the ordinances that impacted the pension benefits available to the City's elected officers, and we express no opinion on the issue. The sole issue before us is whether the City was obligated to Murphy, Inzunza and Zucchet with a defense to the Lawsuit.
We note that the Lawsuit pleads that a defendant who violates section 87100 "is liable . . . for an amount up to three times the value of the benefit." However, the Lawsuit's prayer for relief does not purport to seek this remedy from Murphy, Inzunza or Zucchet. It merely seeks to invalidate the ordinances at issue.
At its most basic, the word "penalty" is defined as punishment in response to wrongdoing. (See Black's Law Dict. (8th ed. 2004) p. 1168, col. 2 [defining the term "penalty" as "[p]unishment imposed on a wrongdoer"].) There is a fundamental difference between (1) seeking to invalidate a series of ordinances that govern a pension plan (as is the case here), and (2) seeking to impose punishment on specific individuals (which is not the focus of the Lawsuit). The Lawsuit sought to invalidate the challenged ordinances, not to seek redress against Murphy, Inzunza and Zucchet for any alleged wrongdoing. Accordingly, the Lawsuit cannot fairly be characterized as an attempt to impose a punishment on Murphy, Inzunza and Zucchet, and thus is not an action seeking to penalize them.
Because Murphy, Inzunza and Zucchet did not even participate in several of the challenged ordinances, we also question whether the Lawsuit was intended to punish Murphy, Inzunza and Zucchet for their status as alleged wrongdoers, and thus whether the Lawsuit may be characterized as seeking to penalize them. As we have explained, neither Murphy, Inzunza nor Zucchet participated in the adoption of the challenged ordinances in September 2000. Inzunza and Zucchet did not participate in enacting the October 2001 ordinance, and Zucchet did not participate in the January 2002 ordinance.
C. Murphy, Inzunza and Zucchet Were Not Required to File a Claim with the City Under the Tort Claims Act as a Prerequisite to Filing This Action
The City contends that Murphy, Inzunza and Zucchet were required to file a claim under the Tort Claims Act (§§ 910, 912.4, 912.8, 945.4) as a prerequisite to obtaining a declaration that the City is obligated to defend them under section 995. As we will explain, we reject this argument.
As relevant here, section 905 provides that "[t]here shall be presented in accordance with Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910) of this part all claims for money or damages against local public entities" and then lists certain exceptions. Section 945.4 provides that, with certain exceptions, "no suit for money or damages may be brought against a public entity on a cause of action for which a claim is required to be presented in accordance with Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910) of Part 3 of this division until a written claim therefor has been presented to the public entity and has been acted upon by the board, or has been deemed to have been rejected by the board."
"The Tort Claims Act requires that any civil complaint for money or damages first be presented to and rejected by the pertinent public entity . . . ." (Munoz v. State of California (1995) 33 Cal.App.4th 1767, 1776.) "Compliance with the claims statutes is mandatory [citation]; and failure to file a claim is fatal to the cause of action." (City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 454.)
As a first ground for rejecting the City's position, we rely on the rule that "[t]he [Tort] Claims Act generally applies only to claims for money or damages, and not to actions for declaratory relief." (Hart v. County of Alameda (1999) 76 Cal.App.4th 766, 782, italics added.) "The claims statutes do not 'impose any . . . requirements for nonpecuniary actions, such as those seeking injunctive, specific, or declaratory relief.' " (Minsky v. City of Los Angeles (1974) 11 Cal.3d 113, 121, fn. & italics omitted.) Here, Murphy, Inzunza and Zucchet are seeking only declaratory relief, i.e., a declaration that the City is obligated to provide them with a defense under section 995. Thus, they were not required to file a claim before bringing this action.
The request to recover the attorney fees and costs incurred in this action does not constitute a separate claim for relief that would itself require the presentation of a claim to the City. As section 800 makes clear, it is "ancillary only, and shall not be construed to create a new cause of action." (§ 800, subd. (b).)
As a separate ground for rejecting the City's position, we note that "[t]he claims statute applies, by its terms, only to causes of action which are governed by chapters 1 and 2 of part 3 of division 3.6 of the Government Code," and "[s]ection 905, subdivision (c), specifically excludes from application of the statute those claims 'by public employees for fees, salaries, wages, mileage or other expenses or allowances.' " (Longshore v. County of Ventura (1979) 25 Cal.3d 14, 22 [ruling that plaintiff who alleged that his government employer was obligated to compensate him for overtime credits and that he was unjustly deprived of property rights without due process was entitled to recover against the employer despite not filing a claim under the Tort Claims Act] (italics added).) We conclude that the claim by Murphy, Inzunza and Zucchet that the City is obligated to pay their defense costs in the Lawsuit is a claim for "other expenses or allowances" within the meaning of section 905, subdivision (c). We reach this conclusion because an eligible public employee is entitled to payment of defense costs covered by section 995, just as that employee becomes entitled to payment of other expenses. Thus, for this reason as well, Murphy, Inzunza and Zucchet were not required to file a claim with the City prior to bringing suit to obtain a defense in the Lawsuit.
D. The Trial Court Did Not Err in Declining to Grant a Continuance to Allow the City to Conduct Discovery
The City contends that the trial court erred in deciding the summary judgment motion without granting it a continuance to conduct discovery pursuant to Code of Civil Procedure section 437c, subdivision (h). Specifically, in its briefing to the trial court, the City stated that it was attempting to depose Murphy (and eventually other council members) in another action and that Murphy's deposition would have some bearing on the issues presented in the summary judgment motion in this action.
Code of Civil Procedure section 437c, subdivision (h) provides in relevant part: "If it appears from the affidavits submitted in opposition to a motion for summary judgment or summary adjudication or both that facts essential to justify opposition may exist but cannot, for reasons stated, then be presented, the court shall deny the motion, or order a continuance to permit affidavits to be obtained or discovery to be had or may make any other order as may be just."
We apply an abuse of discretion standard of review to the trial court's decision not to continue a summary judgment motion for the purpose of allowing further discovery. (Knapp v. Doherty (2004) 123 Cal.App.4th 76, 100.)
We conclude that the trial court did not abuse its discretion. In support of its request to continue the summary judgment motion, the City submitted a declaration from a deputy city attorney stating, ". . . I believe that the deposition of . . . Murphy and all other former council members, including Zucchet and Inzunza, will provide relevant information needed to oppose the motion for summary judgment regarding their personal benefits, retirement applications, actions taken while members of the council, reasons for acting, self serving conduct, [and] violation of . . . sections 1090 and 87100."
However, neither in this declaration nor in its briefing did the City identify any issue of fact to be developed at Murphy's deposition that was relevant to the disposition of the summary judgment motion. As we have explained, summary judgment was properly granted based on (1) the fact that the City Council had not made a determination that any exception set forth in section 995.2 applied here, and (2) the fact that the Lawsuit did not seek to penalize Murphy, Inzunza and Zucchet within the meaning of section 995.4. Thus, the ruling on the summary judgment motion was predicated on (1) the record of the City Council's decision to deny a defense to Murphy, Inzunza and Zucchet; and (2) the allegations contained in the Lawsuit. The City made no showing that discovery from Murphy would relate to either of these factual predicates, and accordingly identified no "facts essential to justify opposition" that would be revealed through further discovery. (Code Civ. Proc., § 437c, subd. (h).) The trial court was thus well within its discretion to deny the continuance sought by the City.
E. The Award of Attorney Fees and Costs Incurred in This Action
In their complaint and in their summary judgment motion, Murphy, Inzunza and Zucchet requested that the trial court order the City to pay the attorney fees and costs that they incurred in this action. As authority, they cited section 800 and Code of Civil Procedure section 128.5. In their complaint, the request was supported by the allegation that "without justification, the [City] arbitrarily and capriciously declined to uphold its obligation to provide [Murphy, Inzunza and Zucchet] with a defense," and that the City's "unexcused refusal to perform an acknowledged duty is oppressive, motivated by bad faith, frivolous, lacking in any reasonable justification, and capricious."
The trial court awarded attorney fees and costs, but it did not specify the statutory authority for the award. We thus consider whether the award was permissible under either of the two provisions cited in Murphy, Inzunza and Zucchet's complaint, i.e., section 800 or Code of Civil Procedure section 128.5.
Code of Civil Procedure section 128.5 is clearly inapplicable here. Under that statute, "[e]very trial court may order a party, the party's attorney, or both to pay any reasonable expenses, including attorney's fees, incurred by another party as a result of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay." By its plain terms, Code of Civil Procedure section 128.5 allows a trial court to impose the payment of attorney fees to sanction impermissible conduct in the present lawsuit before it. (See Levy v. Blum (2001) 92 Cal.App.4th 625, 635 (Levy) [explaining that "[w]hen the Legislature enacted [Code of Civil Procedure] section 128.5, its intent was ' "to broaden the powers of trial courts to manage their calendars and provide for the expeditious processing of civil actions by authorizing monetary sanctions" ' " and was enacted "as a means of controlling burdensome and unnecessary legal tactics"].) Because Murphy, Inzunza and Zucchet were not seeking an award of attorney fees and costs based on the City's litigation conduct during this action, but rather based on the City's decision to deny them a defense to the Lawsuit, Code of Civil Procedure section 128.5 does not apply.
Further, Code of Civil Procedure section 128.5 is applicable only to proceedings initiated on or before December 31, 1994, which is clearly not the case here. (Id., subd. (b)(1); Levy, supra, 92 Cal.App.4th at pp. 638-639.)
The next issue is whether an award of attorney fees and costs is warranted under section 800. That statute provides in relevant part:
"In any civil action to appeal or review the award, finding, or other determination of any administrative proceeding under this code or under any other provision of state law . . . if it is shown that the award, finding, or other determination of the proceeding was the result of arbitrary or capricious action or conduct by a public entity or an officer thereof in his or her official capacity, the complainant if he or she prevails in the civil action may collect from the public entity reasonable attorney's fees, computed at one hundred dollars ($100) per hour, but not to exceed seven thousand five hundred dollars ($7,500), if he or she is personally obligated to pay the fees in addition to any other relief granted or other costs awarded." (§ 800, subd. (a).)
Thus, "[s]ection 800 sets out four conditions for the recovery of attorney's fees: (1) a civil action to appeal or review an administrative proceeding; (2) the complainant must prevail against a public entity or official; (3) arbitrary or capricious action by the public entity or official; and (4) the complainant is personally obligated to pay the fees . . . ." (Kreutzer v. County of San Diego (1984) 153 Cal.App.3d 62, 78.)
Three of these elements can be established here without significant dispute. First, the City's decision to deny a defense to Murphy, Inzunza and Zucchet constitutes a "determination of any administrative proceeding" within the meaning of section 800, and this action seeks a review or appeal of that determination. (See Reeves v. City of Burbank (1979) 94 Cal.App.3d 770, 773 & fn. 1 [§ 800 applied to a municipality's denial of an application to relocate a building to another location]; Forrest v. Trustees of Cal. State University & Colleges (1984) 160 Cal.App.3d 357, 368 (Forrest) ["There is no rationale for limiting section 800 to 'appeal or review' from a formal administrative hearing. It is a remedial statute designed to enable employees to seek relief in the courts against arbitrary or capricious action by public entities or officers, and as such, should be liberally construed" (italics added)].) Second, Murphy, Inzunza and Zucchet have prevailed here by obtaining a declaration that they are entitled to a defense from the City. Third, the record contains no indication that anyone other than Murphy, Inzunza and Zucchet are obligated to pay the fees and costs they incurred in litigating this action.
We now turn to the remaining element, i.e., whether the City's determination not to provide for a defense "was the result of arbitrary or capricious action or conduct." (§ 800, subd. (a).) In the context of section 800, " '[t]he phrase "arbitrary or capricious" encompasses conduct not supported by a fair or substantial reason [citation], a stubborn insistence on following unauthorized conduct [citation], or a bad faith legal dispute [citation].' . . . ' "Attorney's fees may not be awarded . . . simply because the administrative entity or official's action was erroneous, even if it was 'clearly erroneous.' " ' . . . 'The determination of whether an action is arbitrary or capricious is essentially one of fact, within the sound discretion of the trial court . . . .' " (Reis v. Biggs Unified School Dist. (2005) 126 Cal.App.4th 809, 823, citations omitted.) The trial court's decision "will be sustained on appeal unless an abuse of discretion is shown." (Forrest, supra, 160 Cal.App.3d at p. 368.)
The trial court did not expressly cite section 800 as the basis for its award of attorney fees; nor did it make an express finding that the City's conduct was arbitrary or capricious within the meaning of section 800. However, based on the record, we conclude that the trial court intended section 800 as the authority for its award. We base this conclusion on the fact that the trial court made its ruling regarding the award of attorney fees immediately following an express request by counsel for Murphy, Inzunza and Zucchet to award attorney fees and costs under section 800 on the ground that the City's denial of a defense was arbitrary or capricious.
Further, because the City did not request a statement of decision regarding the attorney fee award, we will imply a finding, consistent with the requirements of section 800, that the City acted arbitrarily or capriciously in denying a defense to Murphy, Inzunza and Zucchet. (See McLaughlin v. Walnut Properties, Inc. (2004) 119 Cal.App.4th 293, 302) ["[N]o statement of decision was requested or rendered. As a result, we will imply all findings necessary to support the judgment, so long as those findings are supported by substantial evidence"]; People v. Tannehill (1961) 193 Cal.App.2d 701, 706 ["Implicit in every order made in response to a motion is a finding of those facts supported by the evidence which are necessary to sustain it"]; Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140 [in a case where the trial court did not issue a statement of decision concerning a fee award, " ' "[a]ll intendments and presumptions are indulged to support [the judgment] on matters as to which the record is silent, and error must be affirmatively shown" ' "].)
As we will explain, substantial evidence supports the finding.
As we will explain, we conclude that substantial evidence in the record supports the trial court's implied finding that the City acted arbitrarily or capriciously, and that the trial court thus did not abuse its discretion in awarding attorney fees and costs to Murphy, Inzunza and Zucchet under section 800.
Under the deferential substantial evidence standard, we examine " 'whether there is any substantial evidence, contradicted or uncontradicted, which will support the [finding]. When two or more inferences can be reasonably deduced from the facts, the reviewing court is without power to substitute its deductions for those of the trial court.' " (Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559, 571.)
" '[C]onduct not supported by a fair or substantial reason may be categorized as arbitrary and capricious. [Citation.] The courts often characterize unsubstantiated determinations as arbitrary.' " (A.B.C. Federation of Teachers v. A.B.C. Unified Sch. Dist. (1977) 75 Cal.App.3d 332, 343.) Applying this definition of arbitrary conduct, we conclude that the record contains substantial evidence that the City acted arbitrarily or capriciously in denying a defense to Murphy, Inzunza and Zucchet. Specifically, the record establishes that the City denied Murphy, Inzunza and Zucchet's request for a defense, but it provided no reason for its decision. Nor did the City set forth any other reason for its decision, and on appeal the City has identified no other exception that applies. Moreover, the City failed to substantiate its determination even though it was aware that it was required to provide a defense unless one of the exceptions set forth in sections 995.2 or 995.4 applied, and even though one of the council members suggested that the City Council make a finding to explain why it was denying the defense.
Applying the substantial evidence standard, because the City did not indicate any reason for its decision to deny a defense to Murphy, Inzunza and Zucchet, we conclude that the record contained sufficient evidence for the trial court to conclude that the City acted arbitrarily or capriciously in making its decision. Further, because substantial evidence supports the trial court's implied finding of arbitrary or capricious action by the City, we conclude that the trial court was within its discretion to award Murphy, Inzunza and Zucchet the attorney fees and costs they incurred in this action pursuant to section 800.
We do, however, find error in the trial court's failure to limit the fee award in accordance with the standards set forth in section 800. Section 800 limits an award of attorney fees to "reasonable attorney's fees, computed at one hundred dollars ($100) per hour, but not to exceed seven thousand five hundred dollars ($7,500)." (§ 800.) The trial court did not limit the attorney fees in this manner. Instead, the judgment states that Murphy, Inzunza and Zucchet "are entitled to recover from [the City] all attorneys' fees and costs of suit incurred by them, or to be incurred by them, in the prosecution of the instant action." Nor does the record contain any indication that the City submitted evidence of its attorney fees for an evaluation of reasonableness as required by section 800. Accordingly, we vacate the portion of the judgment awarding attorney fees to Murphy, Inzunza and Zucchet, and we remand for proceedings in which the trial court shall consider the amount of attorney fees to be awarded consistent with the standards set forth in section 800.
DISPOSITION
The portion of the judgment concerning the award of attorney fees incurred by Murphy, Inzunza and Zucchet in this action is vacated, and the case is remanded for the trial court to apply the standards set forth in section 800 in making the award of attorney fees. In all other respects, the judgment is affirmed. Murphy, Inzunza and Zucchet are to recover their costs on appeal.
WE CONCUR: BENKE, Acting P. J., McDONALD, J.