Judge: Mitchell L. Beckloff, Case: 21STCP01836, Date: 2023-01-25 Tentative Ruling
Case Number: 21STCP01836 Hearing Date: January 25, 2023 Dept: 86
OC AUTOSOURCE, INC. v. DEPARTMENT OF MOTOR VEHICLES
Case Number: 21STCP01836
Hearing Date: January 25, 2023
[Tentative] ORDER DENYING PETITION FOR WRIT OF MANDATE
Petitioner, OC Autosource, Inc., seeks an order compelling Respondent, the Department of Motor Vehicles (DMV), to vacate its discipline of Petitioner’s dealer’s license.
Petitioner failed to file an opening brief. The DMV opposes the petition. The DMV lodged the administrative record.
The Petition is DENIED.
STATEMENT OF THE CASE
On or about May 10, 2019, the DMV issued Petitioner a formal warning letter about a consumer complaint it had received. (AR 81-82.)
On July 9, 2019, Petitioner sold a Porsche to a customer and accepted a trade-in of that customer’s 2015 BMW I8. (AR 195-196.) The trade-in vehicle had an outstanding loan balance due of $75,180. (AR 84.) Petitioner did not discharge the outstanding loan balance on the trade-in vehicle within 21 days and the customer filed a complaint with the DMV on October 4, 2019. (AR 67-69.) While Petitioner made at least one partial payment toward the outstanding balance, it did not fully pay the amount owed on the customer’s loan balance until November 6, 2019. (AR 200-201.) Petitioner also paid the customer for the extra costs incurred as a result of its delayed payment. (AR 200-201.)
On January 15, 2020, after an investigation into the customer’s complaint, the DMV issued a misdemeanor citation to John Anthony Thompson, president of Petitioner. (AR 15-16.)
On May 22, 2020, the DMV filed an Accusation against Petitioner, alleging a violation of Vehicle Code section 11705, subdivision (a). (AR 26-28.) On March 3, 2021, an administrative law judge (ALJ) with the Office of Administrative Hearings conducted a hearing on the Accusation. (AR 166.)
The ALJ issued her proposed decision and order on March 10, 2021. (AR 12-22.) The ALJ found Petitioner violated Vehicle Code section 11709.4 by failing to pay off the loan lien on the BMW within 21 days of Petitioner’s transaction with the customer. (AR 17-18.) The ALJ further found Petitioner did not timely pay off the BMW’s lien despite being “aware of the 21-day pay-off obligation.” (AR 18.) Despite the violation, the ALJ found that revocation of Petitioner’s license would be unduly punitive and that “the public can be adequately protected by placing [Petitioner] on probation for two years, under terms including that respondent serve an actual five-day suspension and obey all laws.” (AR 19-20.) The ALJ’s proposed decision also included a condition requiring DMV employees to post notices of suspension in according with the provisions of California Code of Regulations, title 13, section 316.00 during the period of Petitioner’s actual suspension. (AR 20-21.)
On April 14, 2021, the DMV adopted the ALJ’s proposed decision as its own, effective May 15, 2021. (AR 11.) The DMV denied Petitioner’s request for reconsideration on May 20, 2021. (AR 2.)
This proceeding ensued.
STANDARD OF REVIEW
Petitioner challenges the DMV’s decision pursuant to Code of Civil Procedure section 1094.5.
Petitioner contends the DMV abused its discretion when it disciplined Petitioner’s dealer’s license because the penalty was unduly punitive, and the DMV’s decision was not supported by the evidence or law. The DMV contends three separate standards of review apply to Petitioner’s writ of mandate: (1) a weight of the evidence standard for disputes regarding the DMV’s factual findings in the hearing; (2) a manifest abuse of discretion standard for disputes regarding the severity of the sanctions imposed on Petitioner; and (3) de novo review for purely legal questions.
Under Code of Civil Procedure section 1094.5, subdivision (b), the issues for review of an administrative decision are: whether the respondent has proceeded without jurisdiction, whether there was a fair trial, and whether there was a prejudicial abuse of discretion. An abuse of discretion is established if the respondent has not proceeded in the manner required by law, the decision is not supported by the findings, or the findings are not supported by the evidence. (Code Civ. Proc., § 1094.5, subd. (b).)
The parties agree the DMV’s suspension of a license is reviewed under the court’s independent
judgment. (Pet., Mem. P&A’s 8:3-6; Opposition 9:12-13.)
Accordingly, the court “ ‘not only examines the administrative record for errors of law but also exercises its independent judgment upon the evidence.’ ” (Fukuda v. City of Angels (1999) 20 Cal.4th 805, 816, fn. 8.) Exercise of independent judgment “does permit (indeed, [] requires) the trial court to reweigh the evidence by examining the credibility of witnesses.” (Barber v. Long Beach Civil Service Com. (1996) 45 Cal.App.4th 652, 658.) Under independent judgment, “abuse of discretion is established if the court determines that the findings are not supported by the weight of the evidence.” (Code of Civ. Proc., § 1094.5, subd. (b).)
Finally, Evidence Code section 664 creates a presumption “that official duty has been regularly performed.” (Evid. Code, § 664.) “In a section 1094.5 proceeding, it is the responsibility of the petitioner to produce a sufficient record of the administrative proceedings; ‘. . . otherwise the presumption of regularity will prevail, since the burden falls on the petitioner attacking the administrative decision to demonstrate to the trial court where the administrative proceedings were unfair, were in excess of jurisdiction, or showed’ prejudicial abuse of discretion.” (Elizabeth D. v. Zolin (1993) 21 Cal.App.4th 347, 354.) This presumption of correctness includes giving great weight to the agency’s credibility determinations even where the standard of review is independent judgment. (Fukuda v. City of Angels, supra, 20 Cal.4th at 819.)
However, the court reviews an agency’s penalty decision for a manifest abuse of discretion. “[In] a mandamus proceeding to review an administrative order, the determination of the penalty by the administrative body will not be disturbed unless there has been an abuse of its discretion.” (Skelly v. State Personnel Board (1975) 15 Cal.3d 194, 217.) Penalty consideration does not allow the court to substitute its own judgment for that of the administrative agency, nor “disturb the agency's choice of penalty absent ‘ “an arbitrary, capricious or patently abusive exercise of discretion” ’ by the administrative agency.” (Cassidy v. California Bd. of Accountancy (2013) 220 Cal.App.4th 620, 628) “Only in an exceptional case will an abuse of discretion be shown because reasonable minds cannot differ on the appropriate penalty.” (County of Los Angeles v. Civil Service Com. of County of Los Angeles (2019) 40 Cal.App.5th 871, 877.)
ANALYSIS[1]
Failure to File an Opening Brief:
Petitioner has failed to file an opening brief or lodge the administrative record with the court. (The court has the administrative record as the DMV lodged it with the court on December 22, 2022.) The court acknowledges the verified petition contains a memorandum of points and authority with citations to non-existent exhibits. Thus, no evidence has been submitted with the petition, and Petitioner has included no citation to the administrative record.
By failing to file an opening brief citing an administrative record in support of its petition, Petitioner has waived any claims alleged in the petition. Petitioner bears the burden of proof in these proceedings and the failure to file an opening brief means Petitioner has not met this burden. (Manriquez v. Gourley (2003) 105 Cal.App.4th 1227, 1233 [“[T]he party challenging the administrative decision bears the burden of convincing the court that the administrative findings are contrary to the weight of the evidence.”]; Weinberg v. Cedars-Sinai Medical Center (2004) 119 Cal.App.4th 1098, 1107 [“Generally, ‘[i]n a section 1094.5 proceeding, it is the responsibility of the petitioner to produce a sufficient record of the administrative proceedings; “. . . otherwise the presumption of regularity will prevail . . . .” ’ ”].)
Moreover, as noted above, Evidence Code section 664 provides a legal presumption “that official duty has been regularly performed.” (Evid. Code, § 664.) Given the presumption and Petitioner’s burden in mandamus, it follows that Petitioner has not met its burden—that is, has not overcome the presumption of regularity contained in Evidence Code section 664. Petitioner makes no argument supported by the administrative record to demonstrate error by the DMV. As noted, it is Petitioner’s affirmative burden in this proceeding to demonstrate error.
Based on the foregoing and Petitioner’s failure to meet its burden, the petition is denied.
For completeness, the court briefly address the merits of Petitioner’s claims.
Whether Petitioner’s Five-Day Suspension Was a Manifest Abuse of Discretion:
Petitioner contends the penalty was unduly punitive and does not protect the public.
As an initial matter, the court notes Petitioner does not dispute the underlying violation of section 11709.4. Rather, Petitioner argues the five-day suspension imposed by the DMV was unduly punitive.
The petition alleges the penalty imposed is unduly harsh because Petitioner claims it was not aware that violating section 11709.4 could result in a license suspension or that a Petitioner’s five-day suspension could affect its reputation. (Pet., Mem. P&A’s 8:17-26.)
Respondent argues the DMV’s penalty was not an abuse of discretion for the following reasons: (1) Petitioner violated the same statute twice within a matter of months (AR 16, 81-82);
(2) Petitioner paid off a trade in vehicle’s loan lien 100 days late, despite repeated requests by the customer (AR 15, 18, 199-201); and (3) Petitioner’s violation harmed a customer. (AR 19, 99-200.) (Opp. 11:22-24.)
Further, the opposition disputes Petitioner’s claim it was not aware of the consequences of the violation; according to the DMV, Petitioner had actual knowledge that violating section 11709.4 would lead to administrative (and criminal) action because it had previously violated the statute and received a warning from the DMV just months before the transaction in issue. (AR 81-82 [May 10, 2019 Warning Letter] [explaining “further violations of this type may result in criminal and/or administrative action.”].)
Further, the plain language of section 11705 allows the DMV to suspend or revoke a dealer’s license for single violations of the Vehicle Code. Section 11705 provides that the DMV “may suspend or revoke the license issued to a dealer . . . upon determining that the person to who the license was issued . . . has done any of the following,” including a violation of section 11709.4. (§ 11705.)
Finally, the DMV is tasked with ensuring that consumers who trade in their vehicles are fairly treated by dealers. (Clerici v. Department of Motor Vehicles (1990) 224 Cal.App.3d 1016, 1029 [purpose of licensing statutes is to insure honesty and integrity and to “[protect] the public from unscrupulous and irresponsible persons.”]) The court recognizes discipline as enforcement of section 11709.4 serves this public interest by protecting the public. (AR 19-20.)
Based on the foregoing, the court is not persuaded by Petitioner’s arguments the penalty imposed by the DMV was too harsh or punitive. That is, the court cannot find the DMV’s decision to suspend Petitioner’s dealer’s license constituted a manifest abuse of discretion.
Whether the Order to Publicly Post its Suspension Was Supported by the Evidence:
Petitioner argues that the record does not support the DMV’s decision to impose a condition of suspension requiring Petitioner post a notice of suspension pursuant to California Code of Regulations, title 13, section 316.00.
Pursuant to California Code of Regulations, title 13, section 316.00, a disciplinary order may include a condition of probation that departmental employees be allowed to post notices of suspension on the licensee’s premises “[i]f an occupational license is actually suspended as a consequence of fraud, intentional or deliberate illegal activity which results in actual loss or damage to a consumer, or other intentional or deliberate misrepresentation and if the disciplinary order also places the license on probation . . . .”
The DMV argues the ALJ (and therefore the DMV) found Petitioner’s actions were deliberate and the customer suffered a loss even if the loss was later reimbursed. (See AR 15, 19.)
Moreover, the DMV argues the claim is now moot. Petitioner never sought a stay of the five-day suspension, which began and ended in May 2021. (AR 11.) That is, Petitioner cannot be granted any relief enjoining the DMV from ordering that its suspension be publicly posted; the discipline has been imposed and is now complete. Because the penalty has been fully enforced and it cannot be “undone” the matter is moot; no relief can be granted as to the claim. (Wilson & Wilson v. City Council of Redwood City (2011) 191 Cal.App.4th 1559, 1574. [“A claim becomes moot when a court ruling can have no practical impact or cannot provide the parties with effective relief.”])
CONCLUSION
Based on the foregoing, the petition is DENIED.
IT IS SO ORDERED.
January 25, 2023 ________________________________
Hon. Mitchell Beckloff
Judge of the Superior Court