>Milpitas> Coalition
For A Better Community v. City of >Milpitas>

 

 

 

 

 

Filed 8/12/13  Milpitas Coalition For A Better Community v. City of Milpitas CA6

 

 

 

 

 

>NOT TO BE PUBLISHED IN OFFICIAL REPORTS

> 

 

California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b).  This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.

 

 

 

IN
THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

 

SIXTH
APPELLATE DISTRICT

 

 
>

MILPITAS COALITION FOR A BETTER COMMUNITY,   Plaintiff and Appellant,   v.   CITY OF MILPITAS,   Defendant and Respondent;   DAVID M. JORDAN,   Real Party in Interest and Respondent.

H038380      (Santa Clara County       Super. Ct. No. CV205163)

 

            Appellant
Milpitas Coalition For A Better Community (Coalition) challenges the trial
court’s judgment denying its petition for a href="http://www.mcmillanlaw.com/">writ of mandate.  The trial court’s judgment followed from its
grant of the motions of respondent City of Milpitas
(the City) and real party in interest David M. Jordan for judgment on the
pleadings.  The City and Jordan
contended that Coalition’s action could not proceed because it had failed to
join Walmart as an indispensable party. 
Coalition contends on appeal that Walmart was neither a necessary nor an
indispensable party.  We conclude that the
trial court did not abuse its discretion in finding that Walmart was a necessary
and indispensable party.  We therefore
affirm the judgment.

>I. 
Background

            In 2009,
Walmart applied to the City for approval of its plan to expand its existing

Milpitas store.  An href="http://www.fearnotlaw.com/">environmental impact report (EIR) was
prepared, but the City found that the EIR did not comply with the California
Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.) and
refused to certify it.  In February 2011,
Jordan circulated an initiative petition proposing the adoption of a specific
plan called the “Milpitas Commercial Specific Plan.”  The specific plan proposed by the initiative,
which Coalition refers to as the “Walmart Initiative,” would apply solely to
the site of Walmart’s existing store and would permit the expansion of the
store.  After the petition was certified
to have been signed by more than 15 percent of the registered voters in
Milpitas, it was presented to the City. 
On April 19, 2011, the City chose to adopt the proposed ordinance rather
than submitting it to the voters. 

            On July 15,
2011, Coalition filed a petition for writ of mandate challenging the City’s
adoption of the ordinance.  It alleged
both that the adoption of the ordinance violated CEQA and that the ordinance
was inconsistent with the City’s general plan.href="#_ftn1" name="_ftnref1" title="">[1]  Walmart was not named as a real party or a
respondent in the petition.  The City’s
answer and Jordan’s answer both alleged as an affirmative defense that Walmart
was an indispensable party and that Coalition had failed to timely name and
serve Walmart as a real party in interest. 
The City and Jordan thereafter moved for judgment or judgment on the
pleadings both on the merits and on the ground that Coalition had failed to
name and serve Walmart.  The court
concluded that Walmart was an indispensable party as to both the CEQA and
non-CEQA causes of action.  It also found
that the petition lacked substantive merit.href="#_ftn2" name="_ftnref2" title="">[2]  The court entered judgment denying the
petition.  Coalition timely filed a
notice of appeal. 

 

II.  Discussion

A.  Claim of Procedural Error

            Coalition
contends that the trial court could not grant a motion for judgment on the pleadings based on Coalition’s failure to join an
indispensable party because the failure to join an indispensable party is not a
statutory ground for a motion for judgment on the pleadings.  (Code Civ. Proc., § 438, subd.
(c)(1)(B).)  Since “[t]he objection that
an indispensable party has been omitted may be raised at any time” (>Hartman Ranch Co. v. Associated Oil Co.
(1937) 10 Cal.2d 232, 265; accord In re
Marriage of Ramirez (2011) 198 Cal.App.4th 336, 345), the form of the
defense motions was irrelevant. 
Furthermore, the defense motions were alternative motions that also
sought judgment under Code of Civil Procedure section 1094.  As the absence of an indispensable party was
pleaded by the defendants in their answers, it could properly be resolved by
the court on their motions for judgment. 
Coalition makes no showing that it was prejudiced by the trial court’s
resolution of this matter on motions for judgment on the pleadings rather than
by some other avenue.

 

B.  Standard of Review

            “Whether a
party is necessary and/or indispensable is a matter of trial court discretion
in which the court weighs ‘factors of practical realities and other considerations.’ ” 
(Hayes v. State Dept. of
Developmental Services (2006) 138 Cal.App.4th 1523, 1529.) 

 

C.  Necessary Party Determination

            The trial
court found that it was “indisputable” based on Coalition’s “own allegations”
that Walmart “was granted an ‘approval’ of its planned expansion” by the
ordinance and therefore was a necessary party for both the CEQA cause of action
and the non-CEQA causes of action. 

            Code of
Civil Procedure section 389 requires that a person be joined as a party “if (1)
in his absence complete relief cannot be accorded among those already parties
or (2) he claims an interest relating to the subject of the action and is so
situated that the disposition of the action in his absence may (i) as a
practical matter impair or impede his ability to protect that interest or (ii)
leave any of the persons already parties subject to a substantial risk of
incurring double, multiple, or otherwise inconsistent obligations by reason of
his claimed interest.”  (Code Civ. Proc.,
§ 389, subd. (a).)  A person meeting
these requirements is often referred to as a “necessary party.”  (Bowles
v. Superior Court (1955) 44 Cal.2d 574, 583; Quantification Settlement Agreement Cases (2011) 201 Cal.App.4th
758, 848.)

            “[Public
Resources Code] section 21167.6.5(a) supplants [Code of Civil Procedure section
389, subdivision (a)] in a CEQA action. 
If an entity is a recipient of an approval for purposes of section
21167.6.5(a), that entity is a necessary party in a CEQA action challenging the
EIR for the project that was approved, and no further showing need be made
under subdivision (a) of Code of Civil Procedure section 389 to make that
entity a necessary party.”  (>Quantification Settlement Agreement Cases,
supra, 201 Cal.App.4th at p.
855.)  Former Public Resources Code
section 21167.6.5, subdivision (a) (the version that was in effect at the time
of the City’s decision) provided:  “The
petitioner or plaintiff shall name, as a real party in interest, any >recipient of an approval that is the
subject of an action or proceeding brought pursuant to Section 21167, 21168, or
21168.5, and shall serve the petition or complaint on that real party in
interest, by personal service, mail facsimile, or any other method permitted by
law, not later than 20 business days following service of the petition or
complaint on the public agency.”  (Former
Pub. Resources Code, § 21167.6.5, subd. (a), italics added.)  Subdivision (d) of that section provided:  “Failure to name potential parties, other
than those real parties in interest described in subdivision (a), is not
grounds for dismissal pursuant to Section 389 of the Code of Civil
Procedure.”  (Former Pub. Resources Code,
§ 21167.6.5, subd. (d).)

            The first
issue is whether Walmart was a necessary party to the CEQA cause of action.  “[R]ecipient of an approval” is not defined
in the statute or illuminated by the legislative history.  Former Public Resources Code section
21167.6.5 was enacted by the Legislature in response to Deltakeeper v. Oakdale Irrigation Dist. (2001) 94 Cal.App.4th 1092
(Deltakeeper) and was intended to
“strengthen the indispensable party rule.” 
(Sen. Rules Com., Off. of Sen. Floor Analyses, 3d reading analysis of
Sen. Bill No. 1393 (2001-2002 Reg. Sess.) as amended August 28, 2002, p. 4.) 

            The
decision in Deltakeeper concerned a
project that was an agreement for the sale of water from one group of agencies
to another group of agencies.  (>Deltakeeper, supra, 94 Cal.App.4th at p. 1095.) 
The lead agencies, which were sellers, certified an EIR for the
project.  (Deltakeeper, at p. 1098.) 
The petitioner challenged the adequacy of the EIR in a petition that
named the lead agencies as respondents and one of the purchasing agencies as
the real party in interest.  Three other
purchasing agencies were not named in the petition.  After the limitations period had run, the
respondents moved to dismiss the petition for failure to join indispensable
parties.  The trial court granted the
motion.  (Deltakeeper, at pp. 1096, 1098-1099.) 

            The Court
of Appeal reversed.  It first addressed
whether the three purchasing agencies unnamed in the petition were necessary
parties.  “[T]he pertinent question is
whether their absence from the litigation would impair their ability to protect
their interests in the ‘subject of the action,’ the validity of the CEQA
determination.”  (Deltakeeper, supra, 94
Cal.App.4th at p. 1101.)  “Plaintiffs
timely named as defendants three parties to the Agreement, all of whom have a
strong interest in upholding the EIR so as to obtain the benefits of the Agreement.  A party’s ability to protect its interest is
not impaired or impeded as a practical matter where a joined party has the same
interest in the litigation.”  (>Deltakeeper, at p. 1102.)  The Court of Appeal found that the three
unnamed agencies were necessary parties, but it concluded that the trial court
had abused its discretion in finding that they were indispensable parties
because there was a “unity of interest” between the unjoined agencies and the
named parties.  (Deltakeeper, at p. 1109.)

            Since we
find no guidance in Deltakeeper or
the legislative history as to the meaning of “recipient of an approval,” we
must look elsewhere.  “Approval” is
defined in the CEQA Guidelines (Cal. Code Regs., tit. 14, § 15000, et seq.).  “ â€˜Approval’
means the decision by a public agency which commits the agency to a definite
course of action in regard to a project intended to be carried out by any
person.”  (CEQA Guidelines,
§ 15352(a).)  However, the word
“recipient” is not defined anywhere in the Public Resources Code or in the CEQA
Guidelines.href="#_ftn3" name="_ftnref3"
title="">[3]  In common parlance, “recipient” means “one
that receives,” and “receive” means “acquire.” 
(Merriam-Webster’s Collegiate Dict. (10th ed. 1993) pp. 975-976.)  Thus, recipient of an approval means one who
acquires an approval.  Since an
“approval” necessarily refers to the project intended to be carried out by a
person, the approval could only be acquired by the person intending to carry
out the project.  “In determining who is
a recipient of an approval under section 21167.6.5(a), ‘we look to their status
in the underlying transaction . . . .’ ”  (Quantification
Settlement Agreement Cases, supra,
201 Cal.App.4th at p. 855.)  

            Here, the
project was indisputably the expansion of the Walmart store.  The ordinance identified the “ ‘developer’ ” of the site affected by the specific plan as “the fee title
holder” of that site—that is, Walmart. 
To ensure approval of the expansion, the ordinance provided that all
further “approvals . . . for development [of the Walmart
site] shall be ministerial, final, and not subject to appeal.”  Since the ordinance therefore gave Walmart a
clear path to expand its store, Walmart was the entity that acquired an
approval as a result of the enactment of the ordinance.href="#_ftn4" name="_ftnref4" title="">[4]  In this context, the trial court did not
abuse its discretion in concluding that Walmart was a “recipient of an
approval” in connection with this project (the specific plan) and therefore was
a necessary party as to the CEQA cause of action.

            The next
question is whether the trial court abused its discretion in determining that
Walmart was also a necessary party for purposes of the non-CEQA causes of
action.  Walmart plainly “claims an
interest relating to the subject of the action . . . .”  (Code Civ. Proc., § 389, subd. (a).)  The subject of the action is the specific
plan designed to ensure approval of Walmart’s plan to expand its existing
store, a plan in which Walmart has a vested interest.  The only real question is whether Walmart “is
so situated that the disposition of the action in [its] absence
may . . . as a practical matter impair or impede [its]
ability to protect that interest . . . .”  (Code Civ. Proc., § 389, subd. (a).)  The trial court found that neither the City
nor Jordan would adequately represent Walmart’s interest.  While Walmart was obligated under the
ordinance to pay the cost of the
City’s defense of the ordinance’s validity, it was not given the power to >control the litigation.  Since Walmart’s litigation interests might
differ from those of the City’s (particularly given that the City previously
rejected Walmart’s expansion project), Walmart could not rely on the City to
protect Walmart’s interest.  And the
ordinance did not obligate Walmart to fund Jordan’s position in the
litigation.  The trial court could have
reasonably concluded that Jordan’s personal interest in Walmart’s expansion
could not be relied upon to ensure that Walmart’s interest was protected.  Consequently, the trial court did not abuse
its discretion in concluding that Walmart was a necessary party as to the
non-CEQA causes of action. 

 

D.  Indispensable Party
Determination

            If a
necessary party cannot be joined, “the court shall determine whether in equity
and good conscience the action should proceed among the parties before it, or
should be dismissed without prejudice, the absent person being thus regarded as
indispensable.  The factors to be
considered by the court include:  (1) to
what extent a judgment rendered in the person’s absence might be prejudicial to
him or those already parties; (2) the extent to which, by protective provisions
in the judgment, by the shaping of relief, or other measures, the prejudice can
be lessened or avoided; (3) whether a judgment rendered in the person’s absence
will be adequate; (4) whether the plaintiff or cross-complainant will have an
adequate remedy if the action is dismissed for nonjoinder.”  (Code Civ. Proc., § 389, subd.
(b).) 

            “The
subdivision (b) factors are not arranged in a hierarchical order, and no factor
is determinative or necessarily more important than another.”  (County
of Imperial v. Superior Court (2007) 152 Cal.App.4th 13, 35.)  On the other hand, “[w]hile it is just one of
the four factors listed in Code of Civil Procedure section 389, subdivision
(b), to be considered in determining whether an unjoined person is an
indispensable party, potential prejudice to that unjoined person is of critical
importance.”  (Tracy Press, Inc. v. Superior Court (2008) 164 Cal.App.4th 1290,
1298.) 

            Coalition
contends that the trial court prejudicially erred because it >failed to consider all four of the
relevant factors.  While the trial court
did not make express findings on each of the four factors, we must presume that
it considered them.  “The doctrine of implied
findings requires the appellate court to infer the trial court made all factual
findings necessary to support the judgment. 
[Citation.]  The doctrine is a
natural and logical corollary to three fundamental principles of appellate
review:  (1) a judgment is presumed
correct; (2) all intendments and presumptions are indulged in favor of
correctness; and (3) the appellant bears the burden of providing an adequate
record affirmatively proving error.”  (>Fladeboe v. American Isuzu Motors Inc.
(2007) 150 Cal.App.4th 42, 58.)  Here,
the record does not affirmatively reflect that the court ignored any of the
relevant factors.  Indeed, the City
explicitly argued at the hearing that the court’s exercise of its discretion
should be guided by the “four” statutory factors. 

            The trial
court concluded that Walmart was an indispensable party because the relief
requested by Coalition would “injure or affect” Walmart’s interest in expanding
its store and neither the City nor Jordan would adequately represent Walmart’s
interest.  The record supports the trial
court’s reasoning.  Coalition’s action
sought to invalidate the ordinance. 
Since the ordinance paved the path for approval of Walmart’s expansion
plans, which had previously been rejected by the City, the invalidation of the
ordinance would clearly injure Walmart’s interest.  The trial court could have concluded that, in
this case, that factor was determinative. 
No “protective provisions” could avoid or lessen this potential prejudice
to Walmart.  Either the ordinance was
valid or it was invalid.  There was no
middle ground.  It is true that the other
two factors did not favor an indispensable party determination.  Even in Walmart’s absence, a judgment
invalidating the ordinance would be valid. 
And dismissal of this action would deprive Coalition of any remedy as
the statute of limitations had long since run on its challenges to the
ordinance.  Yet it was for the trial
court to weigh these four factors and determine, in its discretion, whether,
overall, they weighed in favor of or against an indispensable party
determination.  Because the prejudice
factor was the most “critical” in this case and carried great weight with the
trial court, it could reasonably conclude, in its discretion, that “equity and
good conscience” required an indispensable party finding in this case.

            As the
trial court’s indispensable party finding required dismissal of the Coalition’s
CEQA and non-CEQA causes of action, we need not consider the other issues
raised by the parties in this case.

 

III.  Disposition

            The
judgment is affirmed.

 

 

 

 

                                                                        _______________________________

                                                                        Mihara,
J.

 

 

 

WE CONCUR:

 

 

 

 

 

 

_____________________________

Premo,
Acting P. J.

 

 

 

 

 

 

_____________________________

Grover,
J.