Lorco Properties, Inc. v. Department of Benefit Payments
Decision Date | 29 April 1976 |
Citation | 57 Cal.App.3d 809,129 Cal.Rptr. 312 |
Parties | LORCO PROPERTIES, INC., Petitioner and Appellant, v. CALIFORNIA DEPARTMENT OF BENEFIT PAYMENTS AND the DIRECTOR thereof et al., Respondents. Civ. 47202. |
Court | California Court of Appeals Court of Appeals |
David Silverton and S. Dwayne Chasteen, Los Angeles, for petitioner and appellant.
Evelle J. Younger, Atty. Gen., Philip C. Griffin, and Rodney Lilyquist, Jr., Deputy Attys. Gen., for respondents.
Lorco Properties, Inc. (hereinafter referred to as Lorco) appeals from a judgment of the trial court denying Lorco's mandamus petition and affirming the determination of the California Unemployment Insurance Appeals Board (hereinafter referred to as Appeals Board).
In 1965 Lorco became subject to the provisions of the Unemployment Insurance Code and was assigned account No. 155-- During the quarter ending June 30, 1973, Lorco again began to report taxable wages and pay unemployment contributions to the Department. On August 22, 1973, the Department notified Lorco that it had been assigned a new account, No. 225--2432, because its former account was cancelled. Lorco then initiated further administrative proceedings.
9508 by the Department of Benefit Payments (hereinafter referred to as Department). Lorco reported taxable wages and paid unemployment contributions to the Department through June 30, 1968. Thereafter, Lorco continued to file contribution returns with the Department showing no taxable wages. On June 30, 1972, the Department cancelled Lorco's account by an automatic data processing operation.
On October 24, 1973, Lorco made written request to Department to transfer the reserves credited under its former account to its new account pursuant to Unemployment Insurance Code section 1051. On November 14, 1973, the Department denied the request for transfer.
On November 27, 1973, Lorco petitioned the Appeals Board, which affirmed the decision of the referee. Thereupon Lorco sought judicial review of the Appeals Board's action by petitioning for writ of mandate.
After hearing, the trial court discharged the writ and entered judgment in favor of the Appeals Board and all respondents in this action.
Lorco contends that it is entitled to a writ of mandate compelling the Appeals Board to transfer its old account to its new account because Unemployment Insurance Code section 1029 1 is unconstitutional in that it provides for neither notice nor hearing prior to cancellation of a reserve account.
We are limited on this appeal to a determination of whether the trial court was correct in discharging the writ of mandate. (Agnone v. Hansen (1974) 41 Cal.App.3d 524, 116 Cal.Rptr. 122.)
It appears that Lorco by its course of conduct has been seeking to obtain an increase in its reserve account balance, by having its former balance credited to its new account to thus gain a more favorable tax rate. The situation is best understood by reference to the statutory unemployment insurance system, an adequate explanation of which is found in the case of John Breuner Co. Perluss (1963) 220 Cal.App.2d 163, 164--165, 33 Cal.Rptr. 580, 580--581:
It is clear that under this system of accounting the reserve account is utilized as a basis for adjusting the employer's tax rate according to the experience rating the employer receives. Lorco would not be entitled under this system to receive a tax rate lower than that of a new employer, once its new account is opened, because for the three years immediately preceding its reserve account was not subject to charges for unemployment benefits. (Unemp.Ins.Code, § 982.)
Lorco contends that section 1029 is unconstitutional because it fails to provide for notice to the employer and the opportunity for a hearing before the reserve account is cancelled. (Sniadach v. Frmily Finance Corp. (1969)395 U.S. 337, 89 S.Ct. 1820, 23 L.Ed.2d 349; Randone v. Appellate Department (1971) 5...
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