Date: 12-03-2019

Case Style:

Case Number: B289597

Judge: Lui, P.J.

Court: California Court of Appeals Second Appellate District, Division Two on appeal from the Superior Court, County of Los Angeles

Plaintiff's Attorney: Jacob A. Kalinski and Brian P. Ross

Defendant's Attorney: Mira Hashmall and Emily A. Sanchirico

Description: The Association for Los Angeles Deputy Sheriffs (ALADS)
appeals from a judgment following the trial court’s ruling
sustaining a demurrer to ALADS’s complaint without leave to
amend. ALADS sued respondent County of Los Angeles (County)
concerning the County’s alleged breach of a labor agreement.
The trial court sustained the County’s demurrer on the sole
ground that ALADS failed to exhaust the administrative
remedies available under the labor agreement before filing suit.
We reverse that ruling. ALADS’s complaint alleges that
the County failed to comply with compensation provisions
described in a November 2015 memorandum of understanding
between ALADS and the County (the MOU). Those provisions
required the County to match compensation increases given to
other County safety employee unions. Thus, the issues that
ALADS raises in this action and the relief that it seeks apply to
all its members.
On the other hand, the grievance procedures under the
MOU are only available to individual employees and are not
binding on any other parties. Because those procedures would
require each of the thousands of individual ALADS members to
pursue a grievance through arbitration to obtain the relief that
ALADS seeks in this lawsuit, they are not adequate. The
inadequacy of available administrative procedures is a wellestablished
exception to the rule that a party must exhaust
administrative remedies before seeking judicial relief.
The trial court ruled only on the exhaustion issue. The
County raised a number of other grounds in support of its
demurrer and argues those grounds again on appeal as
alternative grounds to affirm the trial court’s ruling. One of
those grounds is that ALADS should have first pursued the
3
claims in its fourth, fifth, and eighth causes of action alleging
violations of the Meyers-Milias-Brown Act (MMBA; Gov. Code,
§ 3500 et seq.), in proceedings before the Los Angeles County
Employee Relations Commission (ERCOM).1 We agree. ERCOM
has exclusive initial jurisdiction over such claims, and ALADS’s
argument that ERCOM could not provide binding relief is
insufficient to excuse its obligation to first pursue those claims
administratively.
With respect to the County’s other alternative arguments,
we hold that: (1) ALADS’s seventh, ninth, and tenth causes of
action for declaratory relief no longer address any actual
controversy in light of our ruling on the inadequacy of
administrative remedies under the MOU, and the trial court’s
ruling should therefore be affirmed for those causes of action;
(2) ALADS should be given leave to amend its third cause of
action to add as defendants those County officials necessary to
seek writ relief; and (3) ALADS’s second cause of action for
breach of contract and its eleventh cause of action for alleged
breach of the covenant of good faith and fair dealing adequately
state claims for relief.
Accordingly, we will reverse the trial court’s ruling in part,
affirm in part on alternative grounds, and remand for further
proceedings on ALADS’s complaint. ALADS’s first, second, sixth,
and eleventh causes of action may proceed; ALADS will be given
leave to amend its third cause of action; ALADS’s fourth, fifth,
and eighth causes of action will be struck without prejudice
pending ALADS’s exhaustion of administrative remedies
1 Subsequent undesignated statutory references are to the
Government Code.
4
concerning those claims with ERCOM; and ALADS’s seventh,
ninth, and tenth causes of action will be struck because they do
not address a current controversy in light of our holdings.
BACKGROUND
1. The Compensation Provisions of the MOU
ALADS represents nonmanagement deputy sheriffs and
peace officers employed in the County District Attorney’s office.
Management peace officers in those law enforcement agencies are
represented by another employee collective bargaining unit, the
Los Angeles County Professional Peace Officers Association
(PPOA).
ALADS’s complaint alleges that the County failed to
comply with two compensation provisions in the MOU.2 Each of
those provisions required the County to match compensation
2 ALADS’s complaint quoted these provisions. In the trial
court, the County requested judicial notice of the entire MOU,
including two appendices that describe the applicable grievance
procedures. The trial court denied the request on the ground that
the requested items were not relevant or appropriate for judicial
notice under Evidence Code section 452. On appeal, ALADS asks
that we take judicial notice of the MOU along with all other items
that the parties requested be judicially noticed below. ALADS
argues that the MOU was proper for judicial notice under
Evidence Code section 452, subdivision (c), as it was adopted by
the County Board of Supervisors. We agree. The MOU is also
clearly relevant, as it sets forth the compensation provisions at
issue in this action. The grievance procedures described in the
appendices are also relevant to the question of whether those
procedures provide an adequate administrative remedy.
Moreover, the County will not be prejudiced by taking judicial
notice of the MOU on appeal, as it requested such notice below.
We therefore take judicial notice of the MOU.
5
increases given to other County employee groups. One such
provision (the ATB clause) applied if “any recognized County
safety bargaining unit reach[es] a signed agreement that results
in a higher across-the-board (ATB) percent increase for any given
year” than provided to ALADS members. The other provision
(the EE clause) applied if “any recognized County safety
bargaining unit reach[es] a signed agreement that results in an
economic enhancement” greater than that provided to ALADS’s
members. An economic enhancement was defined as any
“uniform allowance, post pay, standby pay, night shift
differential, step increase, vacation time accrual or cash out,
holiday pay or cash out, longevity pay, bonus, stipend, incentive
pay or lump sum payment.”
The MOU was in effect from February 1, 2015, to
January 31, 2018. In May 2017, the County Board of Supervisors
approved a salary adjustment for sworn management peace
officers employed by the sheriff’s department and the district
attorney’s office and represented by PPOA. Pursuant to that
adjustment, such employees who have a supervisory certificate
from the California Commission on Peace Officers Standards and
Training (POST) received an additional 1.5 percent in salary
effective July 1, 2017, and an additional 2.0 percent in salary
effective July 1, 2018.
ALADS alleges that because “the vast majority (if not all) of
the individuals represented by PPOA possess or can readily
obtain Supervisory POST Certificates, the provision of additional
Supervisory POST pay is the equivalent of an across-the-board
increase, triggering the ATB Clause.” It also alleges that the
POST pay increase was an “economic enhancement” that
triggered the EE clause.
6
2. The Grievance Procedure
The MOU contains two appendices describing separate
grievance procedures for ALADS’s sheriff deputies and district
attorney peace officers. The two grievance procedures contain
different definitions of a “grievance.”3 However, the
administrative process involved in the grievance procedures is
generally the same for both groups.
The sheriff’s department grievance procedure recommends
that an employee with a grievance first seek a resolution through
informal discussions with a supervisor. If the grievance is not
resolved through such informal discussion, the employee may
then pursue formal proceedings. The first step in such
proceedings is consideration of the grievance by a “third level
supervisor or middle management representative.” The employee
may then seek a hearing with a review board, consisting of the
employee’s division chief, the area commander “in the employee’s
chain of command,” and up to two additional members of the
sheriff’s department selected by the employee. The review board
issues a recommendation to the sheriff. The decision of the
sheriff “or his/her designated alternate” is final, subject to a
request to pursue arbitration with an appointed arbitrator.
Only grievances “which directly concern or involve the
interpretation or application of the specific terms and provisions
of [the MOU] and which are brought by an employee who was
3 ALADS argues that the definition of a grievance for
sheriff deputies does not include the relief that ALADS seeks in
this action. As discussed below, we do not reach this argument,
as we decide for other reasons that ALADS need not pursue
administrative remedies under the MOU before prosecuting this
lawsuit.
7
represented by ALADS in any steps of the grievance procedure
may be submitted to arbitration.” ALADS initiates arbitration by
sending a written request to ERCOM.
The results of arbitration are binding on the County “[t]o
the extent the decision and award of the arbitrator does not
require legislative action by the Board of Supervisors.”
Arbitration decisions concerning particular designated articles of
the MOU are also nonbinding. Such nonbinding decisions
include those arising from the “Renegotiation” article in the
MOU, which contains both the ATB clause and the EE clause.
Like the grievance procedure for sheriff deputies, the
formal procedure governing district attorney peace officers
establishes various stages of internal review followed by
arbitration. The grievances that are subject to arbitration, the
arbitration procedure, and the categories of binding and
nonbinding results are the same for district attorney peace
officers and for sheriff deputies.
3. ALADS’s Grievances
ALADS alleges that, in June 2017, “out of an abundance of
caution (because ALADS does not concede that the grievance
procedures set forth in the ALADS MOU provide adequate
administrative remedies),” ALADS initiated two grievances
concerning the County’s alleged failure to comply with the ATB
and EE clauses “on behalf of all of its members.” One grievance
concerned sheriff deputies and the other concerned district
attorney employees. After proceeding through all the
preliminary steps of the grievance process, and after ERCOM had
scheduled a hearing on October 23, 2017, concerning ALADS’s
subsequent request for arbitration, the County allegedly
“objected to ALADS’ requests for arbitration on the grounds that
8
ALADS could not initiate a grievance on behalf of the individuals
it represents.”4 At the hearing, ERCOM “directed that the
grievances as presented be scheduled for arbitration, and advised
that the arbitrator could rule on the County’s objections.”
According to a verified complaint that ALADS filed in
another action concerning the ATB and EE clauses (which we
have judicially noticed at the County’s request), the arbitrator
handling the grievances subsequently took the scheduled
arbitrations off calendar as a result of the County’s refusal to
comply with a discovery order.
4. ALADS’s Complaint
ALADS filed its complaint in this action on November 22,
2017. The complaint alleges 11 causes of action, which include:
(1) claims for breach of contract and for declaratory relief
concerning the County’s alleged violation of the ATB and EE
clauses in the MOU; (2) a request for a writ of mandate requiring
the County to comply with those clauses; (3) requests for
declaratory relief concerning the County’s alleged obligation to
permit representative grievances; and (4) claims alleging that the
County violated the MMBA by failing to notify ALADS of the pay
increases to employees represented by PPOA and by refusing to
meet and confer with ALADS concerning the effect of those pay
increases on the ATB and EE clauses in the MOU.
The County filed a demurrer raising a number of grounds,
including the claim that ALADS had failed to exhaust its
4 As discussed below, the County claims this objection did
not concern ALADS’s right to represent its members in the
grievance process, but rather to its right to bring a representative
grievance that purported to be on behalf of all of its members
(i.e., a class grievance).
9
administrative remedies under the MOU. The trial court
sustained the demurrer on that ground without leave to amend.
The court rejected ALADS’s argument that the administrative
procedure available under the MOU is inadequate because it does
not permit class grievances. The court concluded that the
argument was not relevant because ALADS’s complaint did not
allege class claims.
DISCUSSION
1. Standard of Review
We review an order sustaining a demurrer de novo. (Lazar
v. Hertz Corp. (1999) 69 Cal.App.4th 1494, 1501.) “ ‘We treat the
demurrer as admitting all material facts properly pleaded, but
not contentions, deductions or conclusions of fact or law.’ ”
(Blank v. Kirwan (1985) 39 Cal.3d 311, 318 (Blank).)
We review the trial court’s decision denying leave to amend
for abuse of discretion. In determining if the trial court has
abused its discretion, “we decide whether there is a reasonable
possibility that the defect can be cured by amendment: if it can
be, the trial court has abused its discretion and we reverse; if not,
there has been no abuse of discretion and we affirm.” (Blank,
supra, 39 Cal.3d at p. 318.)
2. The Trial Court’s Ruling that ALADS Is
Required to Exhaust Administrative Remedies
Under the MOU
The failure to arbitrate in accordance with the grievance
procedures in a collective bargaining agreement is “analogous to
the failure to exhaust administrative remedies.” (Service
Employees Internat. Union, Local 1000 v. Department of
Personnel Admin. (2006) 142 Cal.App.4th 866, 870 (Service
Employees).) “In general, a party must exhaust administrative
10
remedies before resorting to the courts.” (Coachella Valley
Mosquito & Vector Control Dist. v. California Public Employment
Relations Bd. (2005) 35 Cal.4th 1072, 1080 (Coachella Valley).)
This exhaustion doctrine “ ‘is principally grounded on concerns
favoring administrative autonomy (i.e., courts should not
interfere with an agency determination until the agency has
reached a final decision) and judicial efficiency (i.e., overworked
courts should decline to intervene in an administrative dispute
unless absolutely necessary).’ ” (Ibid., quoting Farmers Ins.
Exchange v. Superior Court (1992) 2 Cal.4th 377, 391.) In
addition, even if an administrative proceeding does not eliminate
the need for a subsequent judicial action, it “will still promote
judicial efficiency by unearthing the relevant evidence and by
providing a record which the court may review.” (Westlake
Community Hosp. v. Superior Court (1976) 17 Cal.3d 465, 476.)
However, the exhaustion doctrine is subject to exceptions.
In particular, the doctrine does not apply when the available
administrative remedy is inadequate or when it is clear that
pursuing that remedy would be futile. (City of San Jose v.
Operating Engineers Local Union No. 3 (2010) 49 Cal.4th 597,
609 (City of San Jose); Coachella Valley, supra, 35 Cal.4th at pp.
1080–1081.)
ALADS argues that those exceptions apply here. However,
it also argues that we need not consider the exceptions because
the exhaustion doctrine does not apply at all. ALADS claims that
because ALADS itself has the right to enforce the MOU in court,
it is not obligated to pursue the administrative remedies that are
available to its members. Thus, before determining whether any
exceptions to the exhaustion doctrine apply, we first consider
ALADS’s argument that the doctrine does not apply to its claims.
11
A. ALADS is not exempt from the exhaustion
requirement merely because it filed this
action in its own name
ALADS argues that it was not required to exhaust any
administrative remedies under the MOU because those remedies
apply only to its members and it has filed this lawsuit as an
entity. ALADS bases its argument primarily on our Supreme
Court’s decision in Glendale City Employees’ Assn., Inc. v. City of
Glendale (1975) 15 Cal.3d 328 (City of Glendale).
In City of Glendale, the court held that a memorandum of
understanding between a public union and a public employer
under the MMBA is binding. (City of Glendale, supra, 15 Cal.3d
at pp. 337–338.) In reaching that decision, the court also decided
that the plaintiff union could sue the city to enforce the
agreement on behalf of its members without pursuing a class
action. The court explained that the plaintiff association, “as the
recognized representative of city employees, may sue in its own
name to enforce the memorandum of understanding.” (Id. at
p. 341.)
The court in City of Glendale also rejected the argument
that the action was barred by the plaintiff’s failure to exhaust
administrative remedies. (City of Glendale, supra, 15 Cal.3d at
pp. 342–343.) However, the court did not do so because the union
had sued in its own name or because it had no right as an entity
to pursue an administrative remedy. Rather, the court held that
the available administrative procedure was inadequate. The
court explained that “the city’s procedure is tailored for the
settlement of minor individual grievances. A procedure which
provides merely for the submission of a grievance form, without
the taking of testimony, the submission of legal briefs, or
12
resolution by an impartial finder of fact is manifestly inadequate
to handle disputes of the crucial and complex nature of the
instant case, which turns on the effect of the underlying
memorandum of understanding itself.” (Ibid.)
Thus, the court in City of Glendale simply applied the
recognized exception to the exhaustion requirement for
administrative proceedings that are inadequate. (City of
Glendale, supra, 15 Cal.3d at p. 342.) It held that a
nonadversary grievance process was not an adequate procedure
to consider broad issues concerning interpretation of the relevant
labor agreement. It did not hold that the plaintiff union had the
right to bypass the administrative process entirely simply
because it had standing to sue in its own name to enforce a labor
agreement on behalf of the employees that it represented.
ALADS also cites Professional Firefighters Inc. v. City of
Los Angeles (1963) 60 Cal.2d 276 and Daniels v. Sanitarium
Assn. Inc. (1963) 59 Cal.2d 602 for the general proposition that a
union itself has standing to sue. But the County does not dispute
that ALADS has standing to pursue this lawsuit. Rather, it
argues that before pursing remedies on behalf of its members in
court, it must first do so through the administrative procedures
specified in the MOU.
We agree that absent an exception to the exhaustion
requirement, ALADS is not exempt from pursuing administrative
remedies on behalf of its members simply because it is the named
plaintiff in this lawsuit. It is clearly able to pursue such
administrative remedies. The County concedes that ALADS “can
13
represent its members in pursuing grievances” and points out
that ALADS is doing so in the pending arbitration.5
ALADS does not assert any claims in this action based on
any unique injury to it as an entity; it seeks only various forms of
relief on behalf of its members. As ALADS’s counsel
acknowledged below, “this is a representative case.” The relief
that ALADS requests is ultimately all directed toward an
interpretation of the MOU that would grant its members
additional compensation under the ATB and EE clauses in the
MOU. None of the authority that ALADS cites supports its
argument that it is exempt from the need to exhaust
administrative remedies on behalf of its members before seeking
relief on their behalf in this lawsuit merely because it filed the
lawsuit under its own name. We therefore reject the argument
that the exhaustion requirement does not apply at all to ALADS.
Although ALADS is not exempt from the exhaustion
requirement, as discussed below we also agree that the
inadequacy exception applies here.
B. Individual remedies under the MOU are
inadequate here
ALADS argues that because classwide relief is not
available through the MOU’s grievance process, to obtain the
benefits it claims are due to its entire membership it would need
5 Indeed, the grievance procedure set forth in the MOU
provides that only grievances that “are brought by an employee
who was represented by ALADS in all steps of the grievance
procedure may be submitted to arbitration hereunder.” The
County claims it has opposed only ALADS’s efforts to prosecute a
grievance seeking classwide relief.
14
to prosecute separate individual grievance actions on behalf of
each of its 7,800 members. We agree that such an onerous and
time-consuming process precludes adequate relief.
It is undisputed that classwide relief is not available under
the administrative procedures set out in the MOU.6 Nor does the
County dispute ALADS’s claim that, although the same contract
interpretation issue would arise in each individual grievance, a
decision on that issue in one member’s proceeding would not have
any binding effect on other members’ claims.
In Tarkington v. California Unemployment Ins. Appeals Bd.
(2009) 172 Cal.App.4th 1494 (Tarkington) the court summarized
6 As mentioned, ALADS attempted to pursue
representative grievances on behalf of all of its members, but, at
least as far as the appellate record shows, ALADS’s effort was
unsuccessful. As discussed further below, ALADS also asserted
alternative causes of action in its complaint in this case seeking a
declaration that it is entitled to pursue representative grievances
on behalf of its members. It argues on appeal that such
grievances are permitted under principles of waiver and estoppel.
However, regardless of the merits of those causes of action, they
do not mean that adequate administrative relief is available.
Even if ALADS were ultimately successful in obtaining a judicial
order requiring a class grievance, that result would not provide
adequate relief. Such an order would simply mean that, before
even obtaining the right to pursue meaningful administrative
remedies, ALADS would have been compelled to obtain judicial
relief. Requiring a judicial action before pursuing administrative
relief as a prelude to a second judicial proceeding does not
conserve judicial resources and does not provide a timely remedy.
(See City of San Jose, supra, 49 Cal.4th at p. 609 [administrative
relief is inadequate “when the administrative procedure is too
slow to be effective”].)
15
the law on exhaustion of administrative remedies when a judicial
action seeks relief on behalf of a class. The court explained that,
if the available administrative remedies “do provide classwide
relief, than [sic] at least one plaintiff must exhaust them before
litigation may proceed. If the remedies do not provide classwide
relief, then no plaintiff need exhaust them before suing.” (Id. at
p. 1510.)
For this analysis the court in Tarkington relied on Rose v.
City of Hayward (1981) 126 Cal.App.3d 926 (Rose) and Lopez v.
Civil Service Com. (1991) 232 Cal.App.3d 307 (Lopez). In Rose,
retired police officers and fire fighters petitioned on behalf of a
putative class for a writ of mandate requiring the state pension
system to include certain fringe benefits in the compensation
portion of their retirement benefit formula. The available
administrative hearing procedure did not provide for class relief.
The appellate court held that the available administrative
remedies were inadequate, explaining that “plaintiffs in a class
action need not exhaust their administrative remedies prior to
instituting judicial proceedings where the administrative
remedies available to the plaintiffs do not provide for class relief.”
(Rose, at p. 935, citing Ramos v. County of Madera (1971)
4 Cal.3d 685, 690–691 (Ramos).)
In Ramos, our Supreme Court held that individual
administrative hearings were an inadequate remedy for a class of
families who were allegedly threatened with termination of their
public benefits. (Ramos, supra, 4 Cal.3d at pp. 690–691.) The
court concluded that there was “no failure to exhaust an
administrative remedy for class relief, for no such administrative
remedy existed.” (Id. at p. 691.)
16
Lopez, supra, 232 Cal.App.3d 307, involved class claims by
a San Francisco city meter reader alleging that salary data for
comparable positions in other organizations were not properly
included in his salary computations. The named plaintiff had
failed to file an appeal of the issue with the San Francisco Civil
Service Commission. The court held that the judicial action was
barred by the exhaustion doctrine, rejecting the proposition that
“class actions are per se exempt from the exhaustion
requirement.” (Id. at p. 313.) The court concluded that Rose did
not adopt such a rule, but simply “relied on the settled maxim
that exhaustion does not apply where the administrative remedy
provided is either unavailable or inadequate to afford the relief
sought.” (Lopez, at pp. 312–313.) However, in contrast to the
situation in Rose, in Lopez administrative relief applicable to the
entire class was available: “the Commission regularly hears
appeals from individual employees on matters which affect the
entire class to which they belong.” (Lopez, at p. 313.)
These cases are all consistent with the court’s conclusion in
Tarkington that, when a judicial action seeks relief on behalf of a
class, and the available administrative procedures do not provide
classwide relief, “then no plaintiff need exhaust them before
suing.” (Tarkington, supra, 172 Cal.App.4th at p. 1510.) That
conclusion applies here.7
7 The holding in Tarkington is also consistent with this
conclusion. In that case, a putative class of grocery store workers
sought an order directing that they be paid unemployment
benefits following a lock-out during a labor dispute. (Tarkington,
supra, 172 Cal.App.4th at pp. 1498–1500.) Some members of the
class (Tarkington and Straub) had already pursued
17
The County cites Morton v. Superior Court (1970) 9
Cal.App.3d 977, but that case simply rejected the claim that a
party may bypass an available administrative procedure merely
because he or she has filed a class action. The court concluded
that the exhaustion requirement barred that action because the
plaintiff police officers “failed to demonstrate that the city
grievance procedure was inadequate to protect the members of
the class they allegedly represent.” (Id. at pp. 983–984.) The
court explained that if the plaintiffs had prevailed in the
administrative process, “the ruling would have applied to all
police officers similarly affected,” and, if the decision was
adverse, “it would have had the finality necessary to enable them
to bring a class action.” (Id. at p. 984.) Thus, the holding in
Morton simply shows that an administrative process may be
adequate where it permits relief applicable to the class. That is
absent here.
The County also relies on the fact that this is not a class
action. However, it is a representative action. Like the named
plaintiff in a class action, ALADS seeks relief on behalf of a
unemployment benefits through the administrative process,
including to the California Unemployment Insurance Appeals
Board (the Board) “on behalf of themselves and all persons
similarly situated.” (Id. at p. 1499.) The appellate court
concluded that, by “giving the Board the opportunity to consider
the situation, use its expertise, decide this issue, and render
litigation unnecessary, Tarkington and Straub fulfilled all the
purposes of the exhaustion doctrine.” (Id. at p. 1509.) Here,
there is no single board that would decide the compensation
issues that ALADS raises on behalf of all members; rather,
individual grievances would be decided by arbitrators selected by
the individual parties.
18
designated group of persons (i.e., its members). The form of the
action is therefore not material. (Cf. City of Glendale, supra, 15
Cal.3d at p. 341 [the plaintiff’s class allegations were
“superfluous,” because the plaintiff association, “as the
recognized representative of city employees, may sue in its own
name to enforce the memorandum of understanding”].) The
material issue is whether the relief available through the
administrative process would apply to the class of employees that
ALADS represents. It is undisputed that it would not.
The County also argues that ALADS bargained for the
administrative procedure that it now seeks to avoid. But the
County does not cite any support in the record for the conclusion
that ALADS agreed that it would be required to exhaust the
bargained-for grievance procedure on behalf of each of its many
members before asserting the type of classwide claims that it
brings here. We cannot reasonably assume that ALADS agreed
to pursue thousands of individual grievances before seeking a
judicial ruling that the County has breached its agreement to
provide additional compensation to all its members.8
8 That conclusion is also supported by the nonbinding
nature of the arbitrations at issue. As mentioned, arbitrations
concerning disputes arising from the section of the MOU at issue
here are “entirely advisory in nature and shall not be binding
upon any of the parties.” It seems unlikely that ALADS would
agree that it would be required to pursue thousands of such
“entirely advisory” arbitrations on behalf of each of its members
before seeking judicial relief that would be binding upon the
County. Our holding that ALADS is not excused from pursuing
administrative relief on behalf of its members simply by filing a
lawsuit in its own name does not mean that ALADS agreed to
19
Nor has the County provided any legal authority that the
exception to the exhaustion requirement for inadequate remedies
can never apply to negotiated grievance procedures. Service
Employees, supra, 142 Cal.App.4th 866, which the County cites,
suggests the opposite. In that case, the court enforced an
arbitration procedure in a collective bargaining agreement
between a union and the state in a dispute over the distribution
of political literature. However, it did so only after concluding
that the exception for inadequate remedies did not apply. The
court noted that “the union has not presented that rare set of
circumstances compelling us to excuse its failure to exhaust its
negotiated remedies because, as it asserts, it will suffer
irreparable injury, arbitration is inadequate, or judicial delay will
result in a multiplicity of actions.” (Service Employees, at p. 873.)
The court rejected the union’s argument that enforcing the
arbitration provision would lead to a “multiplicity of actions”
because the “state concedes it will be bound by the interpretation
of the arbitrator and therefore will apply the interpretation
consistently and even handedly to future communications.” (Id.
at pp. 874–875.) Here, of course, the County has not agreed that
it would be bound by the results of any arbitration.
During oral argument, the County cited Association for Los
Angeles Deputy Sheriffs v. County of Los Angeles (2015) 234
Cal.App.4th 459 (ALADS v. COLA) in support of its claim that
the bargained-for grievance procedures in the MOU are adequate
despite the absence of a classwide remedy. That case is not
controlling here. In ALADS v. COLA, the County appealed the
pursue such relief where, as here, the grievance process would be
manifestly inadequate to resolve the dispute at issue.
20
trial court’s order staying potential arbitration under labor
agreements with various employee unions pending adjudication
of a cross-complaint that the unions had filed. The appellate
court held only that the trial court erred in staying arbitration
under Code of Civil Procedure section 1281.2 because the
“Unions’ claims in the grievances and the cross-complaint were
the same—i.e., the cross-complaint raised no other nonarbitrable
issues between the parties.” (ALADS v. COLA, at pp. 468–469.)
The court expressly did not consider the unions’ argument that
the unavailability of class arbitration excused them from
participating in arbitrations. (Id. at pp. 466–467.)
The County also suggested during oral argument that
individual ALADS members would be free to pursue judicial
relief once they exhausted their own administrative remedies.
But that possibility does not provide an answer to the inadequacy
of individual administrative remedies here. Without the
County’s agreement to accept the result of any individual
arbitration as binding on others, there could be no classwide
resolution at the administrative level. Ramos, Rose, and
Tarkington establish that administrative relief is not adequate in
a class or representative action if it does not apply to the class.9
9 The practical problems associated with judicial review of
individual grievances in this case illustrates why the availability
of such individual judicial review does not affect this principle.
Assuming (without deciding) that ALADS’s interpretation of the
MOU is correct, individual ALADS members ought to be
successful in their arbitrations. In that event, the County could
simply choose to pay individual successful claims, avoiding
judicial review altogether or at least creating potential standing
21
3. The County’s Alternative Arguments In
Support of Its Demurrer
An order sustaining a demurrer without leave to amend
may be affirmed on any ground stated in the demurrer, even if
the trial court did not act on that ground. (Carman v. Alvord
(1982) 31 Cal.3d 318, 324.) The County raised a number of
grounds in support of its demurrer that the trial court did not
need to reach because of its ruling on the exhaustion issue. The
County raises several of those arguments on appeal as
problems should a successful member attempt to pursue a
judicial action. Because the results of the arbitrations are not
binding, each member would need to pursue his or her own
arbitration no matter how many individual claims the County
previously lost and paid. Perhaps an arbitrator would issue an
adverse ruling and an individual member could then seek a
judicial remedy. However, even if successful, such a remedy
would only resolve the individual claim, requiring the successful
assertion of collateral estoppel, stare decisis, or some other
judicial mechamism to apply the result more broadly. Or
perhaps ALADS (or a member) might attempt again to pursue a
class or representative judicial action following one or more
arbitrations. The County has not agreed that the results of any
one arbitration would suffice to exhaust the administrative
remedies available to other members. Thus, the County might
again raise exhaustion of administrative remedies as a defense to
such a class or representative action. In that event, the
procedural posture of such an action would be no different than it
is now, except for the expenditure of a great deal of time and
effort to obtain a nonbinding ruling by an arbitrator (or
arbitrators) in an individual case (or cases) concerning a global
issue of contract interpretation.
22
alternative grounds to support the trial court’s ruling. We
address those arguments below.
A. ALADS is required to exhaust its
administrative remedies for alleged
violations of the MMBA
ALADS’s fourth, fifth, and eighth causes of action allege
that the County violated the MMBA by: (1) failing to notify and
meet and confer with ALADS concerning the compensation
increase it provided to management employees represented by
PPOA, and (2) objecting to ALADS’s initiation of a representative
grievance. The County argues that ALADS is required to present
these claims in the first instance to ERCOM. We agree.
The MMBA governs collective bargaining for local
government employees. (§ 3500 et seq.) Among other things, the
MMBA imposes a duty on local public agencies to provide notice
to recognized employee organizations of relevant proposed
enactments and to meet and confer with employee organizations
concerning such proposals as well as concerning the terms and
conditions of employment. (§§ 3504.5, subd. (a), 3505; Coachella
Valley, supra, 35 Cal.4th at p. 1083.)
Except in Los Angeles County, the MMBA is administered
by the Public Employment Relations Board (PERB). The PERB
is a “quasi-judicial administrative agency” modeled after the
National Labor Relations Board. (§ 3540; County of Los Angeles
v. Los Angeles County Employee Relations Com. (2013) 56 Cal.4th
905, 916 (County of Los Angeles).) The equivalent of the PERB in
Los Angeles County is ERCOM, which is statutorily empowered
to take actions on unfair practices and to issue “determinations
and orders” as ERCOM deems necessary, “consistent with and
pursuant to, the policies of this chapter [§§ 3500–3511].” (§ 3509,
23
subd. (d).) Thus, ERCOM is “a separate agency empowered to
resolve public employment labor disputes in Los Angeles County
just as PERB does for all other counties in California.” (County of
Los Angeles, at p. 916.)
A complaint alleging a violation of sections 3500 to 3511 is
an unfair practice charge. The PERB has exclusive jurisdiction
to make an initial determination as to whether such charges are
justified and, if so, the appropriate remedy. (§ 3509, subd. (b);
County of Los Angeles, supra, 56 Cal.4th at p. 916 [PERB has
“exclusive initial jurisdiction over complaints alleging unfair
labor practices violating the MMBA”].)
ALADS does not dispute that ERCOM exercises the same
initial exclusive jurisdiction over alleged violations of the MMBA
within Los Angeles County. Rather, ALADS relies on the
principle that exhaustion of administrative remedies may be
excused when an agency lacks authority or jurisdiction to resolve
the relevant dispute. ALADS claims that ERCOM does not have
jurisdiction to “interpret the meaning” of the MOU, which is
exclusively a judicial function.
ALADS cites no authority for this claim. In any event,
ALADS’s fourth, fifth, and eighth causes of action do not seek an
interpretation of the MOU. ALADS’s fourth and fifth causes of
action allege that the County violated the MMBA by failing to
meet and confer. That allegation directly implicates ERCOM’s
function to adjudicate unfair practices. (See San Diego Municipal
Employees Assn. v. Superior Court (2012) 206 Cal.App.4th 1447,
1457 [“Whether an employer’s refusal to satisfy its alleged meet
and confer obligations is an unfair labor practice under the
MMBA is therefore a claim falling within PERB’s exclusive initial
jurisdiction”].) ALADS’s eighth cause of action does not mention
24
the MOU at all, but simply alleges that the County violated
section 3503 by objecting to ALADS’s initiation of a grievance on
behalf of its members.10
ALADS also argues that it is excused from pursuing a
remedy with ERCOM because ERCOM does not have the
authority to issue an order that is binding on the County. Citing
a Los Angeles County employee relations ordinance, ALADS
argues that ERCOM may not issue binding orders that would
require action by the board of supervisors to “make
appropriations, adjustments, transfers or revisions.” (L.A.
County Code, § 5.04.240E1.) The argument is unpersuasive for
several reasons.
First, ALADS does not show that the order it seeks would
be nonbinding. In the relevant causes of action, ALADS does not
request an award of money that would require appropriations or
authorization by the County Board of Supervisors. Rather,
ALADS seeks an order requiring the County to meet and confer
and an order permitting ALADS to pursue a representative
grievance.
Second, the ordinance that ALADS cites clearly expects an
employee organization to pursue a remedy through ERCOM
before seeking a judicial remedy even if ultimate relief would
require further action by the board of supervisors. It provides
that, “[i]f the commission’s decision and order requires action by
the board of supervisors . . . the chief administrative officer shall
10 As discussed above, the County does not dispute that
ALADS has the right to represent its individual members in
pursuing grievances. This cause of action apparently concerns
ALADS’s ability to pursue a grievance on behalf of a class.
25
submit the appropriate documents and materials to the board of
supervisors to enable it to take such action. If the board of
supervisors does not take actions within such reasonable time as
the commission may specify, the commission shall so notify the
other parties. An aggrieved party may then seek judicial relief
from the Superior Court.” (L.A. County Code, § 5.04.240E2.)11
Third, and most important, ALADS does not cite any
authority supporting its argument that it need not pursue a
nonbinding remedy through ERCOM. ALADS cites Coachella
Valley, but that case is inapplicable. In Coachella Valley, our
Supreme Court stated the general rule that exhaustion of
administrative remedies “may be excused when a party claims
that ‘the agency lacks authority, statutory or otherwise, to
resolve the underlying dispute between the parties.’ ” (Coachella
Valley, supra, 35 Cal.4th at pp. 1081–1082.) In that case, the
court decided that exhaustion of remedies before the PERB was
excused where the alleged expiration of a statute of limitations
“deprive[d] the PERB of authority to issue a complaint.” (Id. at
p. 1082.)
Such a deprivation of authority is different from the limited
authority to issue only a nonbinding remedy. (See City of Palo
Alto v. Public Employment Relations Bd. (2016) 5 Cal.App.5th
1271, 1319 [“Coachella Valley does not stand for the proposition
that PERB is necessarily divested of its initial jurisdiction if it is
unable to order a certain remedy”].) Other cases hold that
exhaustion of administrative remedies is required even if the
11 We take judicial notice of this ordinance pursuant to
Evidence Code section 452, subdivision (b) and section 459,
subdivision (a).
26
available remedies are limited or nonbinding. (See Campbell v.
Regents of University of California (2005) 35 Cal.4th 311, 323
[“courts have found the rule inapplicable only when the agency
lacks authority to hear the complaint, not when the
administrative procedures arguably limit the remedy the agency
may award”]; Bockover v. Perko (1994) 28 Cal.App.4th 479, 487
[advisory nature of a hearing body’s decision did not make a
grievance procedure inadequate].)
We therefore conclude that if ALADS elects to pursue its
fourth, fifth, and eighth causes of action, it must first pursue
those claims with ERCOM.
B. ALADS’s claims for declaratory relief in its
seventh, ninth, and tenth causes of action
are moot
ALADS’s tenth cause of action seeks a declaration that “the
issue of the County’s failure to comply with the ATB Clause and
the EE Clause is not within the definition of a grievance as set
forth in Appendix B of the ALADS MOU [applicable to sheriff
deputies], and therefore, ALADS is not required to exhaust
administrative remedies on behalf of those individuals
represented by ALADS who are employed by the County Sheriff’s
Department.” We hold above for other reasons that ALADS is
not required to pursue the grievance procedure in the MOU for
its claims concerning the County’s alleged violation of the ATB
and EE clauses. ALADS’s tenth cause of action is therefore moot.
Stated differently, there is no actual controversy for the court to
resolve. (Code Civ. Proc., § 1060; Ephraim v. Metropolitan Trust
Co. (1946) 28 Cal.2d 824, 836.)
ALADS’s seventh and ninth causes of action are similarly
moot. Those causes of actions seek a declaration that ALADS is
27
entitled to pursue class grievances on behalf of its members.
ALADS alleges that it filed such grievances “out of an abundance
of caution (because ALADS does not concede that the grievance
procedures set forth in the ALADS MOU provide adequate
administrative remedies).”12 As discussed above, we agree with
ALADS’s argument that the individual grievance procedures in
the MOU do not provide adequate administrative remedies here.
ALADS therefore has no need to pursue an administrative
remedy under the MOU. Thus, there is no actual and current
controversy concerning its seventh and ninth causes of action.
The County does not address ALADS’s sixth cause of
action, which seeks a declaration concerning the proper
interpretation of the ATB and EE clauses. That interpretation
goes to the heart of ALADS’s claims against the County.
ALADS’s sixth cause of action may therefore proceed along with
ALADS’s claims seeking damages and other relief based upon the
County’s alleged incorrect interpretation of the ATB clause and
the EE clause.13
12 During oral argument in the trial court, ALADS’s
counsel similarly explained that it filed its seventh cause of
action “in the alternative” to other causes of action that it alleged
in its complaint. During oral argument in this court, ALADS’s
counsel similarly agreed that ALADS’s claims for declaratory
relief concerning its administrative remedies would be moot in
the event that we hold (as we do) that the administrative relief
available under the MOU is inadequate.
13 We do not express any opinion about the proper
interpretation of those clauses or about the ultimate merits of
ALADS’s claims.
28
C. ALADS may amend its third cause of
action to join parties necessary to seek a
writ of mandate
The County argues that ALADS failed to allege facts
necessary for a writ of mandate with respect to ALADS’s third,
fourth, fifth, and eighth causes of action. Because we hold above
that ALADS is required to pursue its administrative remedies
with ERCOM before seeking judicial relief concerning its fourth,
fifth, and eighth causes of action, we need only consider the
County’s arguments with respect to ALADS’s third cause of
action.
That cause of action seeks a writ of mandate directing the
respondents (i.e., the County and unnamed Doe parties) to “act in
compliance with their ministerial duty under the ALADS MOU
by providing individuals represented by ALADS with equivalent
economic enhancements to those provided to individuals
represented by PPOA.” The County argues that, with this claim,
ALADS really seeks to force the County to exercise its discretion
to award economic benefits. It claims that ALADS’s third cause
of action is therefore a “blatant attempt to turn ALADS’ contract
claims into a petition for writ of mandate.”
Our Supreme Court rejected a similar argument in City of
Glendale. The court in that case first observed that “[t]he usual
remedy for failure of an employer to pay wages owing to an
employee is an action for breach of contract; if that remedy is
adequate, mandate will not lie.” (City of Glendale, supra, 15
Cal.3d at p. 343.) But the court also noted that the payment of a
public employee’s wages often requires preliminary steps by
public officials, and that, in such instances, “the action in
contract is inadequate and mandate is the appropriate remedy.”
29
(Ibid.) Because the plaintiff in that case had failed to join as
defendants “the city officials entrusted with the administrative
duties of computing and paying salaries,” the court remanded the
case to permit joinder of the appropriate city officials. (Id. at
p. 345.) The court directed that those officials, once joined,
should not be permitted to raise any defense of laches or
limitations. (Id. at pp. 345–346.)
The court in City of Glendale also rejected the argument
that the adoption of a salary ordinance is a discretionary
legislative decision and is therefore not a ministerial act that
may be compelled through a writ of mandate. (City of Glendale,
supra, 15 Cal.3d at pp. 343–344.) The court approved the trial
court’s analysis that the city’s prior adoption of the memorandum
of understanding at issue “in itself constituted the legislative act
that fixed employee salaries in accord with that understanding.”
The writ therefore simply “directed the non-legislative and
ministerial acts of computing and paying the salaries as fixed by
the memorandum and judgment.” (Id. at p. 344.)
The analysis in City of Glendale controls here. ALADS
seeks an order compelling the County to comply with the
agreement it allegedly already made and approved in the MOU.
As the court explained in City of Glendale, such an order would
not require a new legislative act, but would simply compel
compliance with an act that has already occurred. (City of
Glendale, supra, 15 Cal.3d at p. 344.)
However, as in City of Glendale, in this case ALADS did not
name as defendants the appropriate County officials responsible
for computation and payment of the benefits it claims its
members are due based on the MOU. We therefore will remand
with directions that ALADS be given leave to amend to name
30
those officials. Because the entity that is the real party in
interest (i.e., the County) has already been named and
represented in this action, any newly added County officials will
not be permitted to assert any laches or limitations defenses.
(See City of Glendale, supra, 15 Cal.3d at pp. 345–346.)14
D. ALADS’s second cause of action for breach
of contract states a claim
ALADS’s second cause of action alleges that the County
“unilaterally repudiated” the MOU by “failing to adhere to the
terms of the ATB Clause and EE Clause.” The County argues
that ALADS has not sufficiently alleged facts showing a breach of
contract.
“ ‘An anticipatory breach of contract occurs on the part of
one of the parties to the instrument when he positively
repudiates the contract by acts or statements indicating that he
will not or cannot substantially perform essential terms
thereof.’ ” (Guerrieri v. Severini (1958) 51 Cal.2d 12, 18, quoting
Crane v. East Side Canal etc. Co. (1935) 6 Cal.App.2d 361, 367;
see Jeppi v. Brockman Holding Co. (1949) 34 Cal.2d 11, 18.)
ALADS alleges that the “County has refused to apply either the
ATB Clause or the EE Clause to the PPOA Adjustments.” The
allegation is sufficient to state a breach of contract claim under a
repudiation theory.
14 The County also argues that ALADS failed to allege that
it has no “plain, speedy, and adequate” remedy other than a writ,
because adequate administrative remedies are available.
Because we reject the adequacy of the administrative remedies
available under the MOU, we need not consider this argument
further.
31
E. ALADS’s eleventh cause of action for
breach of the covenant of good faith and
fair dealing asserts a claim
ALADS’s eleventh cause of action alleges that the ATB and
EE clauses included an implied obligation by the County to notify
ALADS of “across-the-board salary increases or economic
enhancements” given to other County bargaining groups. The
County argues that this cause of action fails to state a claim
because such an obligation would constitute a new contractual
obligation that may not be implied.
The covenant of good faith and fair dealing is implied by
law in every contract and exists to prevent one contracting party
from unfairly frustrating the other party’s right to receive the
benefits of the agreement. (Guz v. Bechtel National, Inc. (2000)
24 Cal.4th 317, 349–350.) The scope of the covenant depends
upon the underlying contract: The covenant “cannot ‘ “be
endowed with an existence independent of its contractual
underpinnings.” ’ ” (Ibid., quoting Waller v. Truck Ins. Exchange,
Inc. (1995) 11 Cal.4th 1, 36.)
Here, the parties have different interpretations of the
underlying relevant contractual provisions. Moreover, once the
MOU is interpreted, the scope of the implied covenant may still
depend upon factual issues concerning the parties’ expectations.
For example, ALADS argues that the County had an implied
obligation to notify it of compensation increases to other
employee groups because otherwise “ALADS would have no
ability to enforce its contract.” That argument of course depends
upon a conclusion that ALADS’s interpretation of the contract is
correct. However, it also may depend upon factual issues—such
as ALADS’s access to the County’s compensation decisions and
32
the parties’ course of dealing—that cannot be resolved on
demurrer.
Because the relevant provisions of the MOU remain to be
interpreted, it is premature to determine the scope of the implied
covenant. (See Moore v. Wells Fargo Bank, N.A. (2019) 39
Cal.App.5th 280, 300 [“The breach of the implied covenant cause
of action can be resolved only after a trier of fact resolves the
contract interpretation issue”].) We therefore reject the County’s
argument that ALADS’s eleventh cause of action fails to state a
claim as a matter of law, and we leave to the trial court to
determine the scope of the implied covenant in connection with
its interpretation of the MOU itself.

Outcome: The judgment is reversed. The trial court’s ruling that ALADS must exhaust its administrative remedies under the MOU before pursuing this action is also reversed. The trial court’s ruling sustaining the County’s demurrer without leave to amend is affirmed on alternative grounds with respect to ALADS’s fourth, fifth, seventh, eighth, ninth, and tenth causes of action. The trial court’s ruling sustaining the County’s demurrer to ALADS’s third cause of action is affirmed on alternative grounds with leave to amend as stated below. On remand, the trial court shall: (1) strike ALADS’s fourth, fifth, and eighth causes of action without prejudice, pending ALADS’s exhaustion of administrative remedies concerning those claims with ERCOM; (2) strike ALADS’s seventh, ninth, and tenth causes of action for declaratory relief; (3) strike ALADS’s third cause of action, with leave to amend to name as defendants the County officials necessary for that claim; and (4) permit ALADS’s first, second, sixth, and eleventh causes of action to proceed. The parties shall bear their own costs on appeal.

Plaintiff's Experts:

Defendant's Experts:

Comments: