Hollywood Circle, Inc. v. Department of Alcoholic Beverage Control

• Decision Date: 08 May 1961
• Citation: 55 Cal.2d 728,13 Cal.Rptr. 104,361 P.2d 712
• Court: California Supreme Court
• Parties: , 361 P.2d 712 HOLLYWOOD CIRCLE, INC. (a Corporation), Appellant, v. DEPARTMENT OF ALCOHOLIC BEVERAGE CONTROL et al., Respondents. L. A. 26184.

Page 104

13 Cal.Rptr. 104

55 Cal.2d 728, 361 P.2d 712

HOLLYWOOD CIRCLE, INC. (a Corporation), Appellant, v. DEPARTMENT OF ALCOHOLIC BEVERAGE CONTROL et al., Respondents.

L. A. 26184.

Supreme Court of California, In Bank.

May 8, 1961.

Rosenthal & Rosenthal and Allen M. Rosenthal, Los Angeles, for appellant.

Stanley Mosk, Atty. Gen., and Warren H. Deering, Deputy Atty. Gen., for respondents.

TRAYNOR, Justice.

In 1955 the Department of Alcoholic Beverage Control initiated proceedings for the revocation of petitioner's 'on-sale liquor license.' Petitioner was charged with a violation of section 25601 of the Business and Professions Code, ¹ and after a hearing the department revoked the license. Petitioner attempted to appeal the department's decision to the Alcoholic Beverage Control Appeals Board. The board dismissed the appeal on the ground that it was not timely. Petitioner then sought a writ of mandate to compel the board to consider the appeal.

In the petition for the writ petitioner contended that section 1013 of the Code of Civil Procedure ² applies to appeals to the board and that the appeal was therefore timely. The superior court denied the writ, and the District Court of Appeal affirmed. Hollywood Circle, Inc. v. Dept. Alcoholic Bev. Control, 153 Cal.App.2d 523, 527, 314 P.2d 1007. We denied a petition for hearig, and the United States Supreme Court denied certiorari, 356 U.S. 902, 78 S.Ct. 562, 2 L.Ed.2d 580.

One year later this court expressly disapproved the Hollywood Circle case and held that section 1013 does apply to appeals to administrative agencies such as the board. Pesce v. Dept. Alcoholic Bev. Control, 51 Cal.2d 310, 312-313, 333 P.2d 15. Petitioner then filed with the board an 'Application for Relief from Erroneous Dismissal of Appeal.' The board denied the application and in this proceeding in mandamus petitioner seeks to compel the board to reinstate its appeal. Petitioner contends that the dismissal of the appeal by the board was a void act and that neither section 23090 of the Business and Professions Code, ³ which prohibits reconsiderations and rehearings, nor the doctrine of res judicata, applies to void acts.

The Dismissal of the Appeal by the Appeals Board was Not a Void Act.

In support of its contention, petitioner invokes cases holding that a dismissal of a valid appeal is an act in excess of jurisdiction, and may therefore be reviewed in a proceeding in mandamus. Edwards v. Superior Court, 159 Cal. 710, 713, 115 P. 649; cf. Corrigan v. Superior Court, 72 Cal.App. 383, 385, 236 P. 364. These cases, however, were concerned, not with the doctrine of res judicata, but with the propriety of review by extraordinary writ. See Abelleira v. District Court of Appeal, 17 Cal.2d 280, 287, 288, 109 P.2d 942, 132 A.L.R. 715. An act that may be in excess of jurisdiction so as to justify review by prerogative writ (Abelleira v. District Court of Appeal, supra, 17 Cal.2d at page 288, 109 P.2d at page 947; Fortenbury v. Superior Court, 16 Cal.2d 405, 407, 106 P.2d 411) will nevertheless be res judicata if the court had jurisdiction over the subject and the parties. Signal Oil & Gas Co. v. Ashland Oil & Refining Co., 49 Cal.2d 764, 776-778, 322 P.2d 1.

Petitioner does not contend that the board lacked jurisdiction over the parties. Nor can it be successfuly contended that the board lacked jurisdiction over the subject. The subject was the procedure for filing an appeal to the board. Obviously the board had jurisdiction to determine whether a party followed the procedure prescribed for appearing before it. The board may have erred in its interpretation of the law prescribing the maximum time for filing an appeal, but "(j)urisdiction, (over the subject) being the power to hear and determine, implies power to decide a question wrong as well as right." Signal Oil & Gas Co. v. Ashland Oil & Refining Co., supra, 49 Cal.2d 764, 778, 322 P.2d 1, 10.

The Board's Order Was Res Judicata.

The doctrine of res judicata '* * * is based upon the sound * * * policy of limiting litigation by preventing a party who * * * had one fair trial on an issue from again drawing it into controversy.' Bernhard v. Bank of America, 19 Cal.2d 807, 811, 122 P.2d 892, 894. This policy can be as important to orderly administrative procedure as to orderly court procedure. Some administrative determinations, however, differ greatly from court decisions and greater flexibility is required in applying the doctrine of res judicata to them. (See Groner and Sternstein, Res Judicata in Federal Administrative Law, 39 Iowa L.Rev. 300, 302-305.) 'The key to a sound solution of problems of res judicata in administrative law is recognition that the traditional principal of res judicata as developed in the judicial system should be fully applicable to some administrative action, that the principle should not be applicable to other administrative action, and that much administrative action should be subject to a qualified or relaxed set of rules concerning res judicata.' 2 Davis, Administrative Law, 568; compare Aylward v. State Board of Chiropractic Examiners, 31 Cal.2d 833, 838, 192 P.2d 929 and Empire Star Mines Co. v. California Employment Comm., 28 Cal.2d 33, 48, 168 P.2d 686 with French v. Rishell, 40 Cal.2d 477, 480, 254 P.2d 26 and Goodman Bros. v. Superior Court, 51 Cal.App.2d 297, 301, 124 P.2d 644; see Parker, Administrative Res Judicata, 40 Ill.L.Rev. 56; 29 Cal.L.rev. 741.

The doctrine is not applied when the decision of the agency is made pursuant to its rule-making powers (Olive Proration Program Committee, etc. v. Agricultural Prorate Comm., 17 Cal.2d 204, 208, 109 P.2d 918) or when '* * * the legislature intended that the agency should exercise a continuing jurisdiction with power to modify or alter its orders to conform to changing conditions * * *.' Olive Proration Program Committee, etc. v. Agricultural Prorate Comm., supra, 17 Cal.2d at page 209, 109 P.2d at page 921. Likewise the public interest in preventing the practice of a profession by one not qualified may require a further review of the law applicable to a license to practice. See Aylward v. State Board of Chiropractic Examiners, 31 Cal.2d 833, 192 P.2d 929.

The function of the administrative agency in the present case, however, is the purely judicial one of reviewing another agency's decision to determine whether that decision conforms to the law and is supported by substantial evidence. Bus. & Prof.Code, § 23084. The doctrine of res judicata applies to such a decision, unless the statute creating the agency authorizes it to reconsider the case. Since the board is prohibited from reconisdering or reopening a case after a copy of its decision has been mailed or delivered to the parties (Bus. & Prof.Code, § 23090, supra), its decision was res judicata. ⁴

Moreover, we are not here concerned solely with the act of the board. Over four years ago petitioner sought a writ of mandate in the superior court and in that proceeding the interpretation of section 1013 of the Code of Civil Procedure and the validity of the action of the board was thoroughly litigated. The judgment denying the writ was affirmed on appeal and has now become final. Petitioner has had a full hearing on the merits of its case, three hearings on the issue of the timeliness of the appeal, and two denials of petitions for hearing on that issue. It is settled that the doctrine of res judicata applies to judgments on the merits in proceedings in mandamus. Caminetti v. Board of Trustees, 1 Cal.2d 354, 356, 34 P.2d 1021; Price v. Sixth District Agricultural Ass'n, 201 Cal. 502, 515, 258 P. 387; see Napa Valley Electric Co. v. Board of Railroad Commissioners of California, 251 U.S. 366, 372-373, 40 S.Ct. 174, 64 L.Ed. 310, '(A) final judgment or order is res judicata even though contrary to statute where the court has jurisdiction in the fundamental sense, i. e., of the subject matter and the parties.' Pacific Mut. Life Ins. Co. of California v. McConnell, 44 Cal.2d 715, 725, 285 P.2d 636, 641. The determination in the first mandate proceeding that the dismissal of petitioner's appeal was proper therefore bars any further inquiry into that question. Napa Valley Electric Co. v. Board of Railroad Commissioners of California, supra, 251 U.S. 366, 372-373, 40 S.Ct. 174, 64 L.Ed. 310.

The judgment of the superior court denying the writ of mandate is affirmed.

GIBSON, C. J., and PETERS, WHITE and DOOLING, JJ., concur.

SCHAUER, Justice (dissenting).

I am in accord with the opinion authoried for the District Court of Appeal (reported at 9 Cal.Rptr. 153) by Justice Ashburn and concurred in by Presiding Justice Fox and Justice pro tempore Kincaid, and by reference adopt it as explantory of the reasons why I cannot join my associates in affirming the judgment of the superior court.

Although Justice Ashburn's opinion is fully adequate and impelling to the conclusions reached, it, of course, was written before the opinion of my associates and in view of their position, it appears proper to add emphasis to those facts which essentially distinguish this case from cases relied on by the majority.

Preliminarily it is to be noted that it is now, and at all pertinent times has been, provided in the Constitution of this state that 'When any person aggrieved thereby appeals from a decision of the department * * * revoking any license * * * the (Appeals) board shall review the decision * * *.' (Const. art. XX, sec. 22; italics added.) Most important here is the fact that until the District Court of Appeal acted in the matter now at bench, no appellate tribunal, either administrative or judicial, had ever exercised jurisdiction over the appeal of plaintiff-appellant; i. e., that party had never been accorded its constitutionally granted right. Each and every tribunal which possessed potential contitutional authority to act had expressly refused to pass on the matter. Chronologically the events...