Court of Appeal, Fifth District, California
65 Cal.App.4th 1345,77 Cal.Rptr.2d 360(1998) Rev. Den. Oct. 21, 1998.
Vartabedian, Acting Presiding Justice.
Facts and Procedural History
The City Council of the City of Lindsay,
the present appellant (hereafter the city), for many years accepted saline
industrial waste from a local enterprise known as Lindsay Olive Growers.
The city placed this waste water into percolation ponds and, in subsequent
years, into lined evaporation ponds. Much of the salt from the waste water
percolated into the ground through the original ponds and through holes
in the liners of the later ponds. The salt eventually entered the groundwater
and caused injury to farms in the vicinity of the ponds. The injury consisted
primarily of lost profits from crops and permanent reduction of the value
of the land comprising the farms.
Three farm owners recovered judgments against the city in May of 1991, compensating them under California Constitution, article I, section 19,(1) on an inverse condemnation theory, for their losses caused by the city's pollution of the groundwater. We affirmed these judgments in an unpublished opinion filed January 10, 1996, in F & L Farm Co. v. City of Lindsay, (No. F016555), of which we take judicial notice. On February 27, 1997, the trial court entered a nunc pro tunc amended judgment on behalf of each of the farm owners (we sometimes refer to the owners collectively as respondents). The judgments totaled $2,564,009 plus interest in damages, and $478,928.30 in costs and attorney fees. The city asserts that, with accrued interest, the total owed to respondents now exceeds $5 million.
The city has never paid anything
toward the satisfaction of the judgments against it. On April 11, 1997,
respondents filed a petition for writ of mandate to compel the city to
pay the judgments. The city answered the petition, contending that payment
of the judgments "would result in undue hardship to [the city] and its
citizens" and that the city "lacks the authority to impose taxes, assessments
and/or rates and charges sufficient to pay the judgment with interest thereon
without first obtaining voter and/or land owner approval pursuant to Articles
XIIIC and XIIID of the California Constitution." Various declarations submitted
by the city attested to its lack of funds and its "fragile" economy.
On June 25, 1997, the court entered
judgment for the farm owners. It ordered issuance of a peremptory writ
of mandate commanding the city to pay the judgments "in accordance with
Government Code Section 970.4, the [city] having failed to request to pay
the judgments in installments pursuant to Government Code Section 970.6."
The peremptory writ was issued on June 25, 1997. The city's motions for
a new trial and for entry of a new and different judgment were denied on
July 22, 1997. The city filed a timely notice of appeal.
The city recognizes that it owes respondents money pursuant to the judgments. It acknowledges that the relevant Government Code sections impose upon it a duty to pay the judgments.(2)
The city contends, however, that articles XIIIA, XIIIB, XIIIC and XVI so limit its ability to tax and spend as to override its statutory duty to pay the underlying judgments. Accordingly, the city argues, the "impossibility" of generating income to pay the judgments renders relief by writ of mandate inappropriate, notwithstanding Government Code section 970.2.
In making its argument, the city
gives far too little consideration to the constitutional requirement for
compensation that is the basis of the underlying judgments against it.
In fact, the city ignores this facet of the case altogether: Article I,
section 19, is not cited, much less discussed, in either of the city's
briefs filed in this court. Properly considered in light of well-established
canons of constitutional interpretation, the constitutional provisions
upon which the city relies do not relieve the city of the duty to pay the
As established in our previous opinion
in case No. F016555, the city's action and inaction with respect to pollution
of respondents' groundwater constituted "taking or damage" of respondents'
property for purposes of article I, section 19. As such, the judgments
are appropriately characterized as "inverse condemnation" judgments. (See
Bunch v. Coachella Valley Water Dist. (1997) 15 Cal.4th 432, 435-436, 63
Cal.Rptr.2d 89, 935 P.2d 796.)
Both inverse condemnation awards
and constitutional limitations on government spending have a long history
in this state. In a brief historical digression, we will examine both.
* * *
Similarly, article XI, former section
18, was also adopted in 1879; it provided:
" 'No county, city, town, township,
board of education, or school district, shall incur any indebtedness or
liability in any manner or for any purpose exceeding in any year the income
and revenue provided for such year, without the assent of two-thirds of
the qualified electors thereof, voting at an election to be held for that
purpose, ...' " (Mahoney v. San Francisco (1927) 201 Cal. 248, 251-252,
257 P. 49.)
This same debt limitation is carried
over, with certain additions, in the present article XVI, section 18. This
constitutional limitation is one of those upon which the city relies for
the proposition that it cannot pay the judgments underlying this action.
Despite the constitutional debt limitation,
the courts held from an early date that involuntary obligations of the
local government entity were not affected by the constitutional limitation.
Thus, in Oscar Heyman & Brother v. Bath (1922) 58 Cal.App. 499, 208
P. 981 the petitioner sought a writ of mandate to force San Francisco to
"levy and collect[ ] ... a tax sufficient to pay a judgment which the petitioner
holds against the said city and county." (Id. at p. 499, 208 P. 981.) The
petitioner had paid a tax under protest and had obtained a judgment determining
the tax was illegal and that the city had to repay it. (Ibid.) San Francisco
demurred, contending that it had no money and could not raise any because
of the debt limitation provisions of article XI, former section 18, as
then constituted. The court pointed out that this section of the constitution
"has been interpreted as applying only to actions ex contracto and not
to actions ex delicto or to obligations directly imposed by statute such
as salaries of public officers." (Ibid.) The court concluded:
"We are satisfied that the payment
of the tax involved here was involuntary and that the judgment is evidence
of an obligation imposed by law.... Such being the case, the city is not
asked to 'incur' an indebtedness in excess of its income and revenue, but
is asked to provide the necessary income and revenue sufficient to meet
an indebtedness imposed upon it by law." (Ibid.)
[A]rticle XVI, section 18, upon which
the city relies in part, is inapplicable to prevent judicial enforcement
by writ of mandate of a judgment imposing inverse condemnation liability:
A judgment imposed on a local government entity by direct operation of
the Constitution, in this case article I, section 19, clearly is an "obligation
imposed by law." (Cf. Gov.Code, § 971 [statutory limits on taxes and
obligations inapplicable to "judgment[s] resulting from a nondiscretionary
act ... includ[ing] a judgment founded upon tort or inverse condemnation
liability"].) Accordingly, cases cited by the city, such as Goldsmith v.
San Francisco (1896) 115 Cal. 36, 46 P. 816 and Barkley v. City of Blue
Lake (1996) 47 Cal.App.4th 309, 54 Cal.Rptr.2d 679, which deal with judgments
entered on contractual obligations of local governments, are wholly inapplicable.
By contrast with the cases addressing
the debt limitations of article XVI, section 18, there is no comparable
body of law clearly establishing that the limitations on local taxing and
spending contained in articles XIIIA, XIIIB and XIIIC are inapplicable
to involuntary debts incurred by local governments. (These articles were
added to the constitution by initiative in 1978, 1979 and 1996, respectively;
we will refer to them as the "initiative limitations.") The city contends
these constitutional provisions immunize it from a writ of mandate compelling
it to satisfy respondents' underlying judgments.
The city fails to offer any reasoned
argument or analysis concerning the applicability of the initiative limitations
in the context of constitutionally based inverse condemnation awards. As
such, we might well deem this issue waived. Nevertheless, in deference
to the taxpayers of the city, a discussion of the issues is warranted.
The initiative limitations provide
in various ways for curbs on the taxing and spending powers of various
governments, including cities. In construing these provisions, we are guided
by well-established canons of interpretation. First, a constitutional or
statutory provision will not be construed so as to violate the federal
Constitution unless such construction is absolutely necessary. Second,
all parts of a constitution or statute are to be construed to give all
sections effect if possible: an implied repeal of an earlier provision
by adoption of a subsequent provision is not a favored construction. These
canons of interpretation lead to the conclusion that the inverse condemnation
exception to article XVI, section 18 also applies to initiative limitations.
The supremacy clause of the federal
Constitution provides: "This Constitution ... shall be the supreme Law
of the Land; and the Judges in every State shall be bound thereby, any
Thing in the Constitution or Laws of any State to the Contrary notwithstanding."
(U.S. Const., art. VI, clause 2.) While the California Constitution's requirement
for compensation in inverse condemnation actions is "somewhat broader"
in some instances than the requirements of the Fifth Amendment to the United
States Constitution (Varjabedian v. City of Madera (1977) 20 Cal.3d 285,
298, 142 Cal.Rptr. 429, 572 P.2d 43), the requirements of the two generally
overlap (see City of Los Angeles v. Tilem (1983) 142 Cal.App.3d 694, 701-702,
191 Cal.Rptr. 229). Accordingly, any judicial construction of the initiative
limitations that prevented payment of inverse condemnation judgments would
conflict, in the large majority of cases, with the Fifth Amendment to the
United States Constitution and would violate the supremacy clause. (See
Howlett v. Rose (1990) 496 U.S. 356, 110 S.Ct. 2430, 110 L.Ed.2d 332; cf.
Redevelopment Agency v. Gilmore (1985) 38 Cal.3d 790, 796, fn. 6, 214 Cal.Rptr.
904, 700 P.2d 794.)
"Where a statute [or state constitutional
provision is susceptible of several interpretations, one of which raises
serious constitutional problems, we will construe the statute, if possible,
to avoid those problems. Construction of the initiative limitations to
carry forward the inverse condemnation exception applicable to article
XVI, section 18, avoids the obvious likelihood that the initiative limitations
would otherwise run afoul of the Fifth Amendment to the United States Constitution
in the context of inverse condemnation judgments. (See Heimann v. City
of Los Angeles (1947) 30 Cal.2d 746, 753, 185 P.2d 597 [allowing costs,
pursuant to art. I, § 14 (now § 19) in inverse condemnation action
even though statute disallowed costs if recovery was less than superior
court jurisdictional limit].)
Secondly, " 'the law shuns repeals
by implication....' [Citation.] Indeed, '[s]o strong is the presumption
against implied repeals that when a new enactment conflicts with an existing
provision, "[i]n order for the second law to repeal or supersede the first,
the former must constitute a revision of the entire subject, so that the
court may say that it was intended to be a substitute for the first." '
[Citations.] Thus, to avoid repeals by implication 'we are bound to harmonize
... constitutional provisions' that are claimed to stand in conflict."
As the city acknowledges, "the language
of the constitutional amendments themselves and the 'legislative history'
of the various initiative measures does not give any indication whatsoever
that there was any thought or consideration given to the potential impact
of these initiatives on the subject matter at hand," that is, payment of
inverse condemnation judgments. "To the contrary, the arguments in favor
of Proposition 13 [which enacted art.e XIIIA] adopt a populist theme that
cannot easily be reconciled with [the city's] interpretation of the measure.
Proponents of Proposition 13 described the measure as directed against
'spendthrift politicians' and as '[r]estor[ing] government of, for and
by the people.' [Citation.]" (Kennedy Wholesale, Inc. v. State Bd. of Equalization,
supra, 53 Cal.3d at p. 250, 279 Cal.Rptr. 325, 806 P.2d 1360.) The entire
context of modern "takings" theory shares this same populist, anti-government
philosophical base. (See, e.g., First Lutheran Church v. Los Angeles County
(1987) 482 U.S. 304, 321, 107 S.Ct. 2378, 96 L.Ed.2d 250; Berger, Happy
Birthday, Constitution: The Supreme Court Establishes New Ground Rules
for Land-Use Planning (1988) 20 Urb. L. 735.) We cannot rationally conclude
that the voters, in enacting the initiative limitations on "big government,"
intended to empower these same governments to damage private property with
impunity and without effective means of compelling the payment of just
compensation to injured citizens.
Article XIIIC, section 2, begins
with the phrase, "Notwithstanding any other provision of this Constitution..."
before requiring a two-thirds vote of the electorate to raise funds "for
specific purposes" by means of a "special tax." In keeping with the long-
standing interpretation of article XVI, section 18, and its predecessors,
we conclude that "specific purposes" must be read to mean "specific purposes
of the local government"--in other words, not the discharge of a duty imposed
A similar limiting construction of
article XIIIB, section 6, was adopted by the Supreme Court in County of
Los Angeles v. State of California, supra, 43 Cal.3d at page 56, 233 Cal.Rptr.
38, 729 P.2d 202. In that case, the question was whether a general increase
in workers' compensation benefits payable by all employers, also payable
by local governments to their injured workers, constituted a "higher level
of service" under an existing "program" mandated by the state. If so, article
XIIIB, section 6, would require the state to reimburse local governments
for their increased costs. (43 Cal.3d at pp. 49-50, 233 Cal.Rptr. 38, 729
The court determined that, in the
absence of any countervailing indication in the history of the initiative
adopting article XIIIB, "the electorate had in mind the commonly understood
meanings of the term ['program']...." (43 Cal.3d at p. 56, 233 Cal.Rptr.
38, 729 P.2d 202.) If the term was used in "such a unique fashion" (id.
at p. 57, 233 Cal.Rptr. 38, 729 P.2d 202) as to include any legislation
that increased the costs of local government, "the result would be far-reaching
indeed" (ibid.). Where "no such intent is reflected in the language or
history of article XIII B or section 6," such an interpretation would be
In the present case, we think a construction
of the term "specific purpose" to include the payment of any debt of the
local government, no matter what the source or nature of the debt, would
give to the phrase "specific purpose" a unique meaning the voters could
not possibly have intended. Such a meaning would ignore both the long-standing
interpretation of constitutional debt/taxation limitations in the context
of article XVI, section 18, as well as the primacy of the "just compensation"
requirement of the state and federal Constitutions. Thus, we conclude payment
of a judgment imposed in an inverse condemnation case does not implement
a municipal "purpose" within the meaning of article XIIIC. Rather, such
payment acts solely to vindicate the constitutional rights of the landowner.
We conclude the assessment of a tax levy is not rendered "impossible," as the city urges, by the initiative limitations or by article XVI, section 18. The trial court correctly ordered the City to pay the judgments in accordance with governing law. The judgment is affirmed.
Thaxter and Levy, JJ., concur.
1. All further
references to roman-numeraled articles are to the California Constitution.
Article I, section 19 provides: "Private property may be taken or damaged
for public use only when just compensation, ascertained by a jury unless
waived, has first been paid to, or into court for, the owner. The Legislature
may provide for possession by the condemnor following commencement of eminent
domain proceedings upon deposit in court and prompt release to the owner
of money determined by the court to be the probable amount of just compensation."
The farm owners did not rely in the court below on the "takings" clause of the Fifth Amendment to the United States Constitution. That provision, made applicable to the states by the Fourteenth Amendment, provides for similar but somewhat narrower protection against governmental takings. (Hensler v. City of Glendale (1994) 8 Cal.4th 1, 9, fn. 4, 32 Cal.Rptr.2d 244, 876 P.2d 1043.)
2. Government Code section 970.2 provides, in part: "A writ of mandate is an appropriate remedy to compel a local public entity to perform any act required by this article."