Shaw v. McMahon

Decision Date31 December 1987
Docket NumberNos. A030459,A031366,A032866,s. A030459
CourtCalifornia Court of Appeals Court of Appeals
PartiesTamie SHAW, Plaintiff and Respondent, v. Linda McMAHON et al., Defendants and Appellants.

John K. Van de Kamp, Atty. Gen., Richard D. Martland, Chief Asst. Atty. Gen., Charlton G. Holland, Asst. Atty. Gen., San Francisco, for defendants and appellants.

Elizabeth R. Arnold, Jane Grant Kerr, Contra Costa Legal Services Foundation, Richmond, Casey McKeever, Sacramento, for plaintiff and respondent.

ANDERSON, Presiding Justice.


Federal law provides that when unemployed parents who are the recipients of benefits from the federally-funded aid to families with dependent children program (AFDC-U) receive a nonrecurring lump-sum of money it shall be treated as income, with the consequence that a fixed period of automatic ineligibility to receive such benefits is imposed based upon the size of the sum and the applicable AFDC-U monthly payment standard. (42 U.S.C. § 602, subd. (a)(17); 45 CFR § 233.20(a)(3)(ii)(F).) The major issue presented on these consolidated appeals is whether current provisions of the Welfare and Institutions Code 1 (especially § 11157) and administrative regulations require the same result with respect to that version of the same program funded exclusively by the state (State-only AFDC-U). (§§ 11201, subd. (b), 11315, subd. (a).)


Petitioner Tamie Shaw (plaintiff) commenced this action by filing a verified petition for writ of mandamus together with a complaint for declaratory and injunctive relief. She alleged that on February 29, 1984, one week after she received a $10,000 insurance settlement for her injuries in a 1980 automobile accident, her AFDC eligibility was terminated. When she applied for resumption of AFDC benefits two months later, "[h]er application was denied by a notice which stated that her receipt of the insurance settlement ... rendered her ineligible for AFDC from April 1984 to October 1985" in accordance with Eligibility and Assistance Standard (EAS) 44-207.4. Plaintiff further alleged that this regulation was unlawful because it "violates" sections 11157 and 11201. Among the various forms of relief sought by plaintiff were a writ of mandamus compelling defendants 2 "to provide State-only AFDC-U benefits to otherwise eligible families without regard to any period of ineligibility based on receipt of a lump sum" and an injunction prohibiting denial of benefits on a contrary basis.

After considering the written and oral arguments of the parties, the trial court issued a permanent injunction and a peremptory writ of mandamus as prayed by plaintiff. Defendants thereafter moved to set aside this decision on the grounds that a recent amendment to section 11157 "make[s] it clear that the lump-sum rule applies to both state only and federal share AFDC programs." This motion was denied, the trial court ruling that the amendment did not validate application of the lump-sum rule to State-only AFDC-U benefits. A judgment ordering the injunctive and mandamus relief requested by plaintiff was subsequently entered. The court specifically noted in the judgment that "The provisions of this injunction are prohibitory, and shall not be stayed if an appeal is filed by defendants." 3

Defendants appealed from the judgment. 4 Their petition for a writ of supersedeas and request for a stay of the judgment was denied by this court. Pursuant to Code of Civil Procedure section 1097, plaintiff then moved the trial court for an order compelling defendants' compliance with the judgment. The motion was granted and an order entered as requested. Defendants filed a timely notice of appeal from this order. 5 The contentions on the judgment and the compliance order are discussed in separate chapters.

A. The Judgment

By the time the trial court entered its judgment, the core of the controversy had boiled down to the interpretation of two versions of section 11157. Our task of reviewing the correctness of the trial court's statutory constructions has been compounded by the fact that section 11157 was amended yet again during the pendency of these appeals. The rule that an injunction is to be evaluated according to the most current law governing at the time of an appeal's resolution (McKinny v. Board of Trustees (1982) 31 Cal.3d 79, 85, fn. 1, 181 Cal.Rptr. 549, 642 P.2d 460; Citizens for Non-Toxic Pest Control v. Department of Food & Agriculture (1986) 187 Cal.App.3d 1575, 1584, 232 Cal.Rptr. 729) obliges us to consider section 11157 at each stage of its evolutionary development. Before doing so, however, it will be useful to place section 11157 in its context in the State-only AFDC-U scheme.

The AFDC program was initiated by Congress as part of the Social Security Act of 1935. (Pub.L. No. 271 (Aug. 14, 1935) 49 Stat. 620.) In 1961 the AFDC-U program was experimentally extended to authorize states to receive matching federal funds for a state-administered system. (Pub.L. No. 87-31 (May 8, 1961) 75 Stat. 75.) The experiment was apparently deemed a success, for the program was made permanent in 1968. (Pub.L. No. 90-248 (Jan. 2, 1968) 81 Stat. 821.) California elected to participate in this model of cooperative federalism. (See Stats.1963, ch. 510, p. 1372; Stats.1965, ch. 1784, p. 3977.) The state was thus obligated to comply with federal laws and regulations in order to receive federal funds. (See 42 U.S.C. § 604, subds. (a) & (d); Lukhard v. Reed (1987) 481 U.S. 368, 107 S.Ct. 1807, ----, 95 L.Ed.2d 328; Shea v. Vialpando (1974) 416 U.S. 251, 253, 94 S.Ct. 1746, 1750, 40 L.Ed.2d 120; Darces v. Wood (1984) 35 Cal.3d 871, 880, 201 Cal.Rptr. 807, 679 P.2d 458.) A state is, however, free to adopt and implement a more liberal eligibility standard with respect to a State-only AFDC-U program. (See Engelman v. Amos (1971) 404 U.S. 23, 24, 92 S.Ct. 181, 182, 30 L.Ed.2d 143; Darces v. Woods, supra, 35 Cal.3d at pp. 894-895, 201 Cal.Rptr. 807, 679 P.2d 458; Reyna v. McMahon (1986) 180 Cal.App.3d 220, 223, 225 Cal.Rptr. 405.) California has enacted its version of such a program. (§ 11201, subd. (b), § 11315, subd. (a); see in detail, post.)

The first version of section 11157 with which we must concern ourselves was enacted in late 1981. As relevant here, it read in pertinent part as follows: "To the extent required, as a condition for receipt of federal funds, by federal law, lump-sum payments of income, as defined by federal law, received by an applicant for or recipient of aid under Chapter 2 (commencing with Section 11200) shall be considered income in the month received and the family shall be ineligible for aid for the number of months that equals the sum of all income received during such month less all applicable income disregards divided by the standard of need applicable to the family...." (Stats.1982, First Ex.Sess., ch. 3, § 10, p. 6894.)

The second version--the one brought to the trial court's attention shortly before the judgment was entered--insofar as it is germane to our inquiry, amended the prefatory part of section 11157 so that it read: "To the same extent as required, as a condition for receipt of federal funds, by federal law...." (Emphasis added; Stats.1984, ch. 1447, § 4, pp. 630-631.) This amendment was an urgency measure effective September 26, 1984 (id., § 16, p. 639), only five days before the October 1, 1984, date to which the judgment was keyed. (See fn. 3, ante.)

The final change wrought by the Legislature occurred during the pendency of these appeals. Effective January 1, 1987, section 11157 was amended to delete the words "same" and "as" inserted by the 1984 amendment. (Stats.1986, ch. 1402, § 4, p. 836.) This brings the evolution of section 11157 full circle, returning its first sentence (the part which the parties treat as controlling) to the exact wording originally construed by the trial court. The correctness of that construction we now consider.

Plaintiff's position at all times has been simple. For her, the variants of section 11157's opening references to "federal funds" and "federal law" demonstrate that California's adoption of the lump-sum rule is confined to the joint state-federal AFDC-U program and thus has no application to the State-only AFDC-U program. Defendants contend that the language " 'lump-sum payments ... received by an applicant for or recipient of aid under Chapter 2' " does apply to the state-only program authorized by sections 11201 and 11315 because these provisions are within Chapter 2. (§§ 11200-11489.)

In construing section 11157 and ascertaining the legislative intent behind it, we first look to the statute's language. (Steketee v. Lintz, Williams & Rothberg (1985) 38 Cal.3d 46, 51, 210 Cal.Rptr. 781, 694 P.2d 1153; Brown v. Superior Court (1984) 37 Cal.3d 477, 485, 208 Cal.Rptr. 724, 691 P.2d 272; T.M. Cobb Co. v. Superior Court (1984) 36 Cal.3d 273, 277, 204 Cal.Rptr. 143, 682 P.2d 338.) All of that language must be considered, giving where possible significance to each word, avoiding constructions which make words surplusage, and reading the statutory language according to its ordinary and usual import. ( Steketee v. Lintz, Williams & Rothberg, supra, 38 Cal.3d at p. 52, 210 Cal.Rptr. 781, 694 P.2d 1153; City and County of San Francisco v. Farrell (1982) 32 Cal.3d 47, 54, 184 Cal.Rptr. 713, 648 P.2d 935.) This court recently reiterated that statutes should receive a practical and common sense construction which achieves a reasonable result consistent with legislative purpose and intent. (Dreyer's Grand Ice Cream, Inc. v. County of Alameda (1986) 178 Cal.App.3d 1174, 1181-1182, 224 Cal.Rptr. 285.) Application of these principles leaves no doubt that the trial court properly sustained plaintiff's construction as correct.

The opening part of section 11157 reading "To the extent required, as a condition...

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