Opinion

McHugh v. Santa Monica Rent Control Board

  • 49 Cal. 3d 348
  • 261 Cal. Rptr. 318
  • 777 P.2d 91
  • 1989 Cal. LEXIS 1597
Court
California Supreme Court
Filed
Aug 17, 1989
Status
Published
Author
Panelli
On the bench
Lucas, Panelli
Cited by
78 cases
Authority
More cited than 5.1%

explaining that delegation of judicial power to administrative agencies is acceptable so long as there is judicial review of the agency’s decisions operating as a “check” on the agency’s exercise of that power

How later courts described this case

  • explaining that delegation of judicial power to administrative agencies is acceptable so long as there is judicial review of the agency’s decisions operating as a “check” on the agency’s exercise of that power
  • stating that “the ‘principle of check’ ” is respected “by providing for judicial review of administrative determinations”
  • “principle of check” requires that courts retain power to make enforceable, binding judgments through review of agency determinations
  • modern decisions recognize that “agencies do indeed exercise ‘judicial-like’ powers, and accept the need for [such] powers in our increasingly complex government”

Written by the judges who cited it.

Distinguished

  • Distinguished by Konig v. Fair Employment & Housing Com., 93 Cal. Rptr. 2d 690 (2000)

    The McHugh court stated: "CFTC, however, is distinguishable.
    California Court of AppealJun 28, 2000Read it
  • Distinguished by Mission Housing Development Co. v. City & County of San Francisco, 59 Cal. App. 4th 55 (1997)

    777 P.2d 91], cited by the City in support of its argument, is inapposite.
    California Court of AppealNov 12, 1997Read it
  • Distinguished by Adams v. Commission on Judicial Performance, 8 Cal. 4th 630 (1994)

    49 Cal.3d at p. 366), is inapplicable to agencies vested with such powers.
    California Supreme CourtOct 31, 1994Read it

The opinion

PANELLI, J.

I concur fully in the judgment and its underlying reasoning. I write separately to emphasize that we do not in this case decide the validity of an administrative scheme that, in the guise of advancing “public” rights or the general welfare, permits an agency to award substantial general compensatory damages to an aggrieved individual on grounds such dam *387 ages further the agency’s regulatory purposes, or are merely “incidental” to other equitable or restitutive relief.

In Labor Board v. Jones & Laughlin (1937) 301 U.S. 1 [ 81 L.Ed. 893 , 57 S.Ct. 615 , 108 A.L.R. 1352 ], cited by the majority {ante, at p. 382), the high court rejected an employer’s Seventh Amendment jury trial challenge to the administrative award of backpay. The court stated, “The Amendment. . . has no application to cases where recovery of money damages is an incident to equitable relief even though damages might have been recovered in an action at law.” ( 301 U.S. at p. 48 [ 81 L.Ed. at p. 918 ].) However, the damages at issue—backpay—were restitutive and quantifiable, analogous to special damages in an action at law. In context, therefore, the high court’s statement cannot be read as upholding the administrative award of general compensatory damages.

In determining the application of our constitutional jury trial provision (Cal. Const., art. I, § 16) to the administrative award of damages, the majority adopts the substantive-limitations test earlier applied in the context of the judicial powers doctrine. Pursuant to that test, if the challenged activities (i.e., the remedy or damages award) “are authorized by statute or legislation, and are reasonably necessary to, and primarily directed at, effectuating the administrative agency’s primary, legitimate regulatory purposes—then the state constitution’s jury trial provision does not operate to preclude administrative adjudication.” {Ante, at p. 380.)

As in Jones, supra, the damages at issue in the instant case—excess rent— are restitutive in kind and limited in amount. Resolution of the jury trial issue, as the majority suggests, “might be different in a situation in which an agency purports to adjudicate substantial ‘damage’ claims such that recovery of damages becomes the primary focus, as opposed to merely an incidental aspect of the regulatory scheme.” {Ante, at p. 381, fn. 53.)

Although the award of general compensatory damages may have substantive effect, in that it deters violation of the regulatory scheme, and thus arguably may meet the substantive-limitations requirement, when the damages awarded advance a substantial private interest in remuneration that is disproportionate to the concept of public relief, the right to jury trial is implicated and a jury is required. Regardless of the substantive effect of a general damages award in effectuating an agency’s legitimate regulatory purposes, an administrative hearing cannot, consistent with the right to trial by jury, be transformed into a forum for adjudicating general damages. Neither the substantive-limitations test, nor our opinion, should be understood as sanctioning an administrative award of unlimited general compensatory damages.

Eagleson, J., concurred.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.

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