Bleeck v. State Board of Optometry

• Decision Date: 24 June 1971
• Citation: 18 Cal.App.3d 415,95 Cal.Rptr. 860
• Parties: Barry BLEECK, Plaintiff and Respondent, v. STATE BOARD OF OPTOMETRY et al., Defendants and Appellants. Civ. 36707.
• Court: California Court of Appeals Court of Appeals

Page 860

95 Cal.Rptr. 860

18 Cal.App.3d 415

Barry BLEECK, Plaintiff and Respondent, v. STATE BOARD OF OPTOMETRY et al., Defendants and Appellants.

Civ. 36707.

Court of Appeal, Second District, Division 2, California.

June 24, 1971.

Hearing Denied Aug. 18, 1971.

Evelle J. Younger, Atty. Gen., and Alvin J. Korobkin, Deputy Atty. Gen., for defendants and appellants.

Gitelson, Katz, Hoyt & Blum and Philip M. Rosten, Los Angeles, for plaintiff and respondent.

HERNDON, Associate Justice.

Appellants are the State Board of Optometry, generally referred to herein as the 'Board', its individual members and its executive secretary. Respondent is an optometrist duly licensed to practice his profession in the State of California. On and prior to October 1, 1959, respondent was licensed to operate some 36 branch offices.

Statement of the Case

The judgment from which this appeal is taken orders the issuance of a writ of mandate by the terms of which the Board is directed within the time specified therein to transfer each of 29 'inactive' branch office licenses for the practice of optometry from their former locations to such other location or locations within the State of California as respondent may from time to time designate in writing to the Board.

Appellants' primary assignment of error is that the trial court erroneously applied the doctrines of res judicata and collateral estoppel in holding that the final judgment in favor of respondent in a prior action constituted such an adjudication of the issues tendered in the instant action as to bar the introduction of any evidence offered by appellants to prove that respondent had abandoned the branch offices involved in this proceeding within the meaning of Rich v. State Board of Optometry, 242 Cal.App.2d 598, 51 Cal.Rptr. 674. Appellants advance the further contentions that respondent's action is barred by the statute of limitations and that the judgment must be reversed because of respondent's failure to exhaust his administrative remedies before seeking judicial review.

To make more readily understandable our later recital of the facts, we shall first briefly summarize the development of the California law governing the rights of an optometrist to maintain and operate branch offices and the conditions under which licenses to operate such branch offices may be transferred from one location to another.

Section 3077 of the Business and Professions Code enacted in 1955 established the requirement that after January 1, 1957, an optometrist must obtain from the Board a branch office license for each branch office which he operated. As originally enacted the statute contained no restriction on the number of branch offices or branch office licenses available to an optometrist.

In 1959, section 3077 was amended so as to restrict the number of branch offices available to an optometrist by providing that '(o)n or after October 1, 1959, no more than one branch office license shall be issued to any optometrist or to any two or more optometrists, jointly.'

However, a so-called 'grandfather clause' was incorporated into the statute by the provisions of subdivision (i) of section 3077 reading as follows:

'Nothing in this chapter shall limit or authorize the board to limit the number of branch offices which are in operation on October 1, 1959 and which conform to the provisions of this chapter, nor prevent an optometrist from acquiring any branch office or offices of his parent. The sale after October 1, 1959 of any branch office shall terminate the privilege of operating such branch office and no new branch office license shall be issued in place of the license issued for such branch office, unless the branch office is the only one operated by the optometrist or two or more optometrists jointly.

'Nothing in this chapter shall prevent an optometrist from owning, maintaining or operating more than one branch office if he is in personal attendance at each of his offices fifty per cent (50%) of the time during which such office is open for the practice of optometry.'

Following the 1959 amendment to section 3077, the Board requested the opinion of the Attorney General of California 'as to whether branch office licenses are transferable at the request of the licensee to a new location.' Under date of December 10, 1959, the Attorney General issued Opinion No. 59/312, the conclusion of which is summarized as follows:

'Branch office licenses issued to registered optometrists are not transferable to a new location. Relocation of a branch office can be accomplished only by surrender of the old license, making proper application for a new branch office license to be issued to the new location, and satisfying the State Board of Optometry that issuance of the new branch office license will not violate the present terms of the act limiting the number of branch offices available to optometrists.'

In July of 1965, the decision in Rich v. State Board of Optometry, 235 Cal.App.2d 591, 45 Cal.Rptr. 512, was filed. That case is sometimes referred to hereinafter as 'the first Rich case.' It involved the appeal of the State Board of Optometry from the judgments of the trial court granting the respondents Rich and Oakley writs of mandate to compel the Board to issue new branch office licenses as sought by the respondents for licensed branch offices which they proposed to move to different locations.

In affirming the judgments, the Court of Appeal discussed at length the meaning and effect of the grandfather clause of section 3077 and commented that '(T)he 1959 amendments to section 3077 were apparently added for the purpose of making the practice of optometry less commercial and more professional, 'to insure an adequate measure of personal performance and supervision in keeping with the nature of the service and the avoidance of the evils of competition which has its place in trade and mercantile pursuits but not in the practice of this profession.' (Citation.)' (At pp. 604--605, 45 Cal.Rptr. at p. 520.)

After a further detailed discussion of the language of the statute, the Court of Appeal concluded (page 607, 45 Cal.Rptr. page 522): 'Accordingly, in spite of the policy considerations involved in the instant case, we are of the opinion that subdivision (i) of section 3077, as properly construed, affords protection to optometrists operating branch offices on October 1, 1959 and that, In the absence of the sale of the business operated at a branch office location, optometrists are entitled to continue to maintain and operate as many branch offices as they operated on October 1, 1959.' (Emphasis added.)

Approximately eleven months later, on June 1, 1966, the decision in the second Rich case was filed, Rich v. State Board of Optometry, 242 Cal.App.2d 598, 51 Cal.Rptr. 674. In this case the appellant Rich applied to the Board in 1963 for licenses for three relocated branch offices which had been closed and discontinued in 1960. The trial court upheld the Board's refusal to reissue branch office licenses for the discontinued offices. The Court of Appeal affirmed the judgment, stating as follows at page 603, 51 Cal.Rptr. at page 677:

'The crucial difference between the facts of the instant case and those of the prior Rich case is that there the petitioners sought to transfer branch office licenses for two of their Existing branch offices. In holding that they were entitled to such relief, we stated that 'optometrists are entitled to Continue to maintain and operate as many branch offices as they operated on October 1, 1959.' (Emphasis added; 235 Cal.App.2d p. 607, 45 Cal.Rptr. 522; see also p. 608, 45 Cal.Rptr. 522.) In the instant case, on the other hand, although Rich operated 13 branch offices as of October 1, 1959, he subsequently discontinued his practice at three of these locations and surrendered his branch office licenses for these three locations to the Board. He is thus not seeking to continue operation of these three branch offices but rather to start anew three branch office practices in the place of the three practices which he abandoned in 1960.

'As we read subdivision (i) of section 3077 it allows an optometrist to Continue to maintain the same number of branch offices which he operated as of October 1, 1959, without regard for the fact that this number may be in excess of the number currently allowed by section 3077. The 'grandfather clause' protection exists, however, only so long as the optometrist Continues to maintain this same number of branch offices. Once he ceases doing business at one of his branch offices, without transferring his practice to another location, he loses the protection afforded by the 'grandfather clause' of section 3077. Moreover, we think that this interpretation of section 3077 is fortified by the purpose of the 'grandfather clause,' which, as stated in Golden Gate Scenic Steamship Lines Inc. v. Public Utilities Comm., 57 Cal.2d 373, 379, 19 Cal.Rptr. 657, 661, 369 P.2d 257, 261, is 'to give those engaged in a business being brought under regulation the right to continue their existing business without being subjected to certification requirements that would be applicable if the business were then being started for the first time.' (See also Harris v. Alcoholic Beverage Control Appeals Board, 61 Cal.2d 305, 38 Cal.Rptr. 409, 392 P.2d 1.) Such a purpose clearly does not extend to a situation like that involved in the instant case where Rich, by virtue of closing three of his branch offices, no longer possesses the vested existing interest or competitive advantage which the 'grandfather clause' seeks to protect.'

Statement of Facts

On or prior to October 1, 1959, respondent Bleeck held licenses for each of the 29 branch offices involved herein. On a number of occasions after January 1, 1960, respondent wrote letters to the Board indicating his intention to close various of these branch offices either because of the expiration of leases or...