Covarrubias v. James

• Decision Date: 15 November 1971
• Citation: 98 Cal.Rptr. 257,21 Cal.App.3d 129
• Parties: Lino COVARRUBIAS and Raymond Brooks, Plaintiffs and Appellants, v. Ronald JAMES et al., City of San Jose, et al., Defendants and Respondents. Civ. 28760.
• Court: California Court of Appeals Court of Appeals

Page 257

98 Cal.Rptr. 257

21 Cal.App.3d 129

Lino COVARRUBIAS and Raymond Brooks, Plaintiffs and Appellants, v. Ronald JAMES et al., City of San Jose, et al., Defendants and Respondents.

Civ. 28760.

Court of Appeal, First District, Division 1, California.

Nov. 15, 1971.

Stephen Manley, Grace M. Kubota, Joel G. Schwartz, Edward Newman, Robert S. Dresser, San Jose, for plaintiffs and appellants.

Ferdinand P. Palla, City Atty. of the City of San Jose, Richard K. Karren, Asst. City Atty., San Jose, Cal., for defendants and respondents.

ELKINGTON, Associate Justice.

Plaintiffs appeal from judgments of dismissal entered in their taxpayers' action, following an order sustaining general and special demurrers to an amended complaint (hereafter 'the complaint'), without leave to amend. Other purported appeals taken from nonappealable orders sustaining such demurrers without leave to amend will be dismissed. (See Beazell v. Schrader, 205 Cal.App.2d 673, 674, 23 Cal.Rptr. 189.)

The defendants consisted of the City of San Jose and certain public agencies and officials, all alleged to be 'charged with the affirmative responsibility in undertaking community redevelopment projects to provide equal opportunities to all persons and not engage in or participate in discrimination because of race, color, religion, national origin or ancestry.'

The complaint was in two counts. The first count alleged: that defendants were engaged in the construction of a public community theater known as the Community Theater Project (hereafter 'project'); that construction of the project would engage the services of skilled union craftsmen of many trades; that defendants had employed a general contractor who had hired or would hire, subcontractors who have exclusive hiring agreements with the several building trade unions involved; and that such unions 'have historically and are presently engaged in a continued pattern of discrimination against Mexican-Americans, Negroes and other minority persons,' with the knowledge of defendants.

The second stated cause of action alleged: that certain of the defendant do, or will in the future, engage in other public construction projects which will employ the same skilled craftsmen of the same unions; that such unions in the County of Santa Clara 'have a disproportionately low number of minority-groups persons as apprentices and/or journeymen compared to the total number of minority-group persons' therein; and that the City of San Jose 'has failed to take any effective steps, or to adopt and implement any affirmative program, to correct the deficiency in the number of minority-groups persons' who reside in San Jose and Santa Clara County.

Neither the contractor of the project, nor any contractor, nor subcontractor, nor union, was joined as a defendant in the action.

Prayed for was a permanent injunction enjoining defendants 'from further expenditures of public monies to contractors on the Community Theater Project * * * and any other public projects where racial discrimination is involved in the hiring practices,' and 'so long as minority group persons are denied equal employment opportunities in the skilled construction trades in such projects.'

Plaintiffs' action was commenced under the asserted authority of Code of Civil Procedure section 526a, which authorizes an action by a taxpayer to obtain a judgment restraining 'any illegal expenditure' of public funds.

The theory of action was: (1) that defendants' participation in the project constituted 'state action,' discriminatory against minority groups, and violative of the due process and equal protection clauses of the Fourteenth Amendment, and (2) that expenditure of public funds on the project by defendants was therefore illegal.

One of the grounds upon which defendants' general demurrer was sustained was that the general contractor, subcontractors, and construction trades unions whose practices were challenged, were indispensable parties to the action. We shall first consider whether this determination of the trial court was correct.

Code of Civil Procedure section 389, as relevant here, provides:

'A person is an indispensable party to an action if his absence will prevent the court from rendering any effective judgment between the parties or would seriously prejudice any party before the court or if his interest would be inequitably affected or jeopardized by a judgment rendered between the parties.' (Emphasis added.)

California's appellate courts, on the same subject, have consistently held that where a plaintiff seeks some 'type of affirmative relief which, if granted, would injure or affect the interests of a third person not joined, that third person is an indispensable party * * *.' (Bank of California, Nat. Ass'n v. Superior Court, 16 Cal.2d 516, 522, 106 P.2d 879; see also Irwin v. City of Manhattan Beach, 227 Cal.App.2d 634, 637, 38 Cal.Rptr. 875; Peabody Seating Co. v. Superior Court, 202 Cal.App.2d 537, 543, 20 Cal.Rptr. 792; Thomson v. Talbert Drainage Dist., 168 Cal.App.2d 687, 689, 336 P.2d 174.)

As pointed out, the object of plaintiffs' action was to enjoin defendant public entities and officials from disbursing public funds on the Community Theater Project and other projects. If the action were to be successful, the following consequences would necessarily flow to third persons not joined in the action.

The general contractor, who by contract is bound to build the project and is to be paid therefor, would find his contract abrogated, and he would be denied any payment, even for work already done.

The project's subcontractors would in effect have any existing contracts with the general contractor nullified, and be denied their right to offer bids on the project or future municipal projects. They also would be denied payment for work, if any, already done on the project. And finally, a judgment determining their 'exclusive hiring agreements' with the concerned construction trades unions to be invalid, would be entered.

The construction trades unions would find their collective bargaining agreements annulled insofar as they relate to public projects of the City of San Jose. And a judicial determination would have been made that the unions had in fact discriminated against 'minority group persons.'

It needs no elaboration to discern that the interests of these nonparties to plaintiffs' action 'would be inequitably affected or jeopardized by a judgment rendered between the parties.' (See Code Civ.Proc., § 389.) The contractor, and the anonymously mentioned subcontractors and construction trades unions alluded to in plaintiffs' complaint were, and are, indispensable parties to plaintiffs' action.

In a somewhat comparable factual context a similar conclusion was reached in Irwin v. City of Manhattan Beach, supra, 227 Cal.App.2d 634, 38 Cal.Rptr. 875. There a 'taxpayer's action,' prosecuted only against the city and certain of its officials sought to have declared void, a contract between the city and certain private parties for construction of an 'across the street' overpass between two buildings. The court found the private parties to be indispensable parties, stating (pp. 636--637, 38 Cal.Rptr. p. 877): 'If plaintiff should receive judgment against the defendants who are before the court for the relief she seeks it would be the duty of the city to cause the structure to be removed; the rights of the permittees under the contract would be annulled and their property would be taken from them by force of a judgment to which they were strangers.'

The failure to bring 'indispensable parties' before the court is jurisdictional; without them the court is powerless to proceed further. (Bank of California, Nat. Ass'n v. Superior Court, supra, 16 Cal.2d 516, 522, 106 P.2d 879; Southern Cal. Title Clearing Co. v. Laws, 2 Cal.App.3d 586, 589, 83 Cal.Rptr. 8; Estate of Reed, 259 Cal.App.2d 14, 22, 66 Cal.Rptr. 193.) The requirement is mandatory. (Hartman Ranch Co. v. Associated Oil Co., 10 Cal.2d 232, 265, 73 P.2d 1163.) And the objection that indispensable parties are not before the court may be raised at any time, by dem...