Judge: Stephen I. Goorvitch, Case: 24STCP04154, Date: 2025-03-14 Tentative Ruling
Case Number: 24STCP04154 Hearing Date: March 14, 2025 Dept: 82
Paveco Construction, Inc. Case No. 24STCP04154
v.
Hearing:
March 14, 2025
Location:
Stanley Mosk Courthouse
Los
Angeles Department of Department:
82
Water
and Power Judge: Stephen I.
Goorvitch
[Tentative] Order Granting SEP’s Motion to
Quash
[Tentative] Order Authorizing Limited
Discovery
INTRODUCTION
Petitioner
Paveco Construction, Inc. (“Petitioner”) filed a petition for writ of mandate
challenging a decision by the Los Angeles Department of Water and Power
(“Respondent” or “DWP”) to award a construction contract to another bidder, S E
Pipe Line Construction Company (the “Real Party” or “SEP”). SEP’s subcontractors include Mallard
Construction, Inc. (“Mallard”), whose president is Samuel Mullen (“Mullen”), as
well as Sully-Miller
Contracting dba Blue Diamond Materials (“Blue Diamond”) and Vulcan Materials
Company (“Vulcan”). Petitioner served
subpoenas to take depositions of the Person Most Knowledgeable (“PMK”) for
Mallard, Blue Diamond, and Vulcan, as well as a subpoena to take the deposition
of Mullen. Now, SEP moves to quash these
subpoenas. The motion is granted. However, the court authorizes Petitioner to
propound certain Requests for Production of Documents upon SEP and the DWP.
PETITIONER’S
ALLEGATIONS
On
or about December 19, 2023, DWP issued an invitation for bids (“IFB”) from
contractors for an award of a contract known as the “Blowout Pavement
Repairs.” (Petition
¶ 14.) The IFB required bidders to comply with
LADWP’s rules for participation from a Small Business Enterprise (“SBE”) or a
Disabled Veran Business Enterprise (“DVBE”).
(Id. ¶ 4 and Exh. A.) The
IFB requires the SBE/DVBE subcontractors to perform at least 20% of the total
amount of the contract; requires the subcontractors to perform “a commercially
useful function;” and requires the
bidder to submit a “Letter of Intent” showing “confirmation from a sub-listed
SBE or DVBE that it is willing to participate in the contract.” (Id. Exh. A at B2-1, B2-3, and
B2-4.) The IFB defines “commercially
useful function” as follows:
Responsibility for the execution of a distinct element of
work of the contract, which is carried out by actually performing, managing,
and supervising the work involved, or fulfilling responsibilities as a Joint
Venture partner, and has a necessary and useful role and the firm’s role is not
superfluously added in an attempt to meet credit toward achievement of the
contract-specific mandatory SBE and/or DVBE requirement.
(Id. at B2-2.)
Two
contractors—Petitioner and SEP—submitted bids in response. (Id. ¶ 15.) SEP’s bid was lower than Petitioner’s
bid. (Id. ¶ 16.) DWP awarded the contract to SEP. (Id. ¶ 17.) On March 8, 2024, Petitioner submitted a bid
protest and made a request under the California Public Records Act (the “CPRA”)
seeking copies of public documents regarding the bids. (Ibid.) The protest states as follows:
[A]t this time, we are protesting the following: (i) One
that [SEP] did not meet the 20% Mandatory SBE / DVBE Participation Requirement
for this Contract; [and] (ii) Two that LADWP is in violation of the “California
Public Records Act” and is withholding records without due cause.
(Petition Exh. B at 2.) Then, on March 27, 2024, Petitioner made a
supplemental bid protest. (Id. ¶
18.) The supplement states as follows:
[T]he
facts and law unequivocally show that SEP did not meet the mandates set
forth in the Bid Invite or the requirements set forth in multiple statutes and
codes.
.
. .
d. DWP’s Bid Invite required 20% SBE/DVBE
participation.
.
. .
g. SEP
provided Letters of Intent by the following entities with the following
participation percentages in its attempt to meet DWP’s 20% SBE/DVBE
participation mandates:
i. Mallard Construction: 18.0%
ii. Lindy’s Cold Planing:
3.0%
iii. Smithson
Electric: 1.0%
22.0%
h. SEP’s
bid list both Mallard Construction and Lindy’s Cold Planing as “Asphalt
Material Suppliers.”
i. Per
DWP’s Bid Invite and Public Contract Code Section 2002(d), material suppliers
do not provide a Commercial Useful Function. . . . Per SEP’s bid both Mallard Construction and
Lindy’s Cold Planing are simply providing asphalt supplies, neither will be
performing, managing, or supervising any work.
j. Thus,
neither Mallard Construction, nor Lindy’s Cold Planing, provide a Commercial
Useful Function.
.
. .
In addition, even if one were to argue that Mallard
Construction and Lindy’s Cold Planing did not provide Commercial Useful
Functions, SEP’s bid still fails to meet the mandates of the Bid Invite because
SEP alleges that Mallard Construction and Lindy’s Cold Planing are “Asphalt
Material Suppliers,” and in order for them to be considered legitimate “Asphalt
Material Suppliers,” they must be in the business of manufacturing asphalt
materials, not just trucking them. . . .
(Petition Exh. C.)
On
December 19, 2024, Petitioner filed this action challenging the LADWP’s denial
of the appeal pursuant to Code of Civil Procedure section 1085. (Id. ¶¶ 83-92.) On or about January 30, 2025, Petitioner
served the deposition subpoenas seeking the deposition and production of
documents from Mallard’s PMK and from Samuel Mullen, Mallard’s CEO/President. (Lee Decl. ¶¶ 2-3, Exh. 1-2.) On or about February 3, 2025, Petitioner
served the deposition subpoenas seeking the deposition and production of
documents from the PMKs of Vulcan Materials Company and Sully-Miller
Contracting dba Blue Diamond. (Id. ¶¶
4-5, Exh. 3-4.) On February 10, 2025,
SEP filed the instant motion to quash.
LEGAL STANDARD
A. Writ
of Mandate
The petition for writ of mandate is brought
pursuant to Code of Civil Procedure section 1085. There are two essential requirements to the issuance of
an ordinary writ of mandate under Code of Civil Procedure section 1085: (1) a
clear, present, and ministerial duty on the part of the respondent, and (2) a
clear, present, and beneficial right on the part of the petitioner to the
performance of that duty. (California Ass’n for Health Services at Home
v. Department of Health Services (2007) 148 Cal.App.4th 696, 704.) “Generally, mandamus is available to compel a public agency’s
performance or to correct an agency’s abuse of discretion when the action being
compelled or corrected is ministerial.” (AIDS Healthcare Foundation v. Los Angeles County
Dept. of Public Health (2011) 197 Cal.App.4th 693, 700.)
An agency is
presumed to have regularly performed its official duties. (Evid. Code § 664.) Generally, the petitioner
“bears the burden of proof in a mandate proceeding brought under Code of Civil
Procedure section 1085.” (California Correctional Peace Officers Assn.
v. State Personnel Bd. (1995) 10 Cal.4th 1133, 1154.) A reviewing court “will not act as counsel
for either party to an appeal and will not assume the task of initiating and
prosecuting a search of the record for any purpose of discovering errors not
pointed out in the briefs.” (Fox v.
Erickson (1950) 99 Cal.App.2d 740, 742.)
B. Motion
to Quash Deposition Subpoena
For good cause shown, the court may enter a
protective order or an order quashing a subpoena to prevent unwarranted
annoyances, embarrassment, oppression, undue burden, and expense in
discovery. (Fireman’s Fund Ins. Co. v. Superior Court (1991) 233 Cal.App.3d
1138, 1141; see also Code Civ. Proc. § 2025.420(b), § 2017.020(a), §
1987.1.) The moving party has the burden
to show good cause for a protective order or an order quashing a deposition
subpoena. (See Emerson Elec. Co. v. Sup.
Ct. (1997) 16 Cal.4th 1101, 1110; Weil & Brown, Civ. Pro. Before Trial
(The Rutter Group 2011) ¶ 8:689.)
C. Discovery
in Administrative Proceedings
In this action, Petitioner seeks a writ of
ordinary mandate pursuant to Code of Civil Procedure section 1085 commanding LADWP to award the Blowout
Pavement Repairs contract to Petitioner and not SEP. (Pet. Prayer ¶¶ 2, 3.) Judicial
review “under Code of Civil Procedure section 1085 is limited to determining whether the
public agency’s action was arbitrary, capricious, entirely without evidentiary
support, or procedurally unfair.” (Federation
of Hillside & Canyon Assns. v. City of Los Angeles (2004) 126
Cal.App.4th 1180, 1195 [internal citations omitted].) Further, the court “must ensure that the
agency adequately considered all relevant factors, and demonstrated a rational
connection between those factors, the choice made, and the purposes of the
enabling legislation.” (Coachella
Valley Unified School Dist. v. State of California (2009) 176 Cal.App.4th
93, 121.)
“An unbroken line of cases holds that, in traditional
mandamus actions challenging quasi-legislative administrative decisions,
evidence outside the administrative record ‘extra-record evidence’ is not
admissible.” (Carrancho v. California Air Resources Board (2003) 111 Cal.App.4th
1255, 1269.) These restrictions do
not apply, however, to ministerial or informal administrative actions. As stated by our Supreme Court, “we will
continue to allow admission of extra-record evidence in traditional mandamus
actions challenging ministerial or informal administrative actions if the facts
are in dispute.” (Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th
559, 576.) This is because “when the
courts are asked to review ministerial or informal administrative actions, …
there is often little or no administrative record in such cases.”
(Id. at 575.)
In addition, there is an exception for
extra-record evidence in traditional mandamus proceedings involving
quasi-legislative decisions “in which (1) the evidence in question existed before the agency made its decision, and (2) it
was not possible in the exercise of reasonable diligence to present this
evidence to the agency before the
decision was made so that it could be considered and included in the
administrative record.” (Western
States, supra, 9 Cal.4th at 578.)
Furthermore, extra-record evidence may be admissible and “relevant to (1) issues other than the validity
of the agency’s quasi-legislative decision, such as the petitioner's standing
and capacity to sue, (2) affirmative defenses such as laches, estoppel and res
judicata, (3) the accuracy of the administrative record, (4) procedural
unfairness, and (5) agency misconduct.”
(Id. at 579, fn. 5.)
Although there is no express provision allowing discovery in
an administrative mandamus proceeding, section
1094.5, subdivision (e) has
been interpreted to allow limited posthearing discovery provided the moving
party shows that such discovery is reasonably calculated to lead to
evidence admissible under section
1094.5…. [D]iscovery under section
1094.5, unlike general civil discovery,
cannot be used to go on a fishing expedition looking for unknown facts to
support speculative theories. The
stringent requirements set forth in section
1094.5, subdivision (e) require the moving
party to identify what evidence is sought to be
discovered for purposes of adding it to the record; to establish the relevancy
of the evidence; and to show that either (a) any such relevant, additional
evidence was improperly excluded at the administrative hearing, or (b) it could
not have been produced at the hearing with the exercise of reasonable
diligence. (Code Civ. Proc. § 1094.5, subd. (e).) If the moving party fails to make the required showing, it
is an abuse of the court's discretion to allow posthearing discovery.
(Pomona
Valley Hospital Medical Center v. Superior Court (1997) 55 Cal.App.4th 93,
102.) Most important, “extra-record
evidence can never be admitted merely to contradict the evidence that the
administrative agency relied on in making a quasi-legislative decision or to
raise a question regarding the wisdom of that decision.” (Western States, supra, 9 Cal.4th at
579.) These same rules apply to a petition for writ
of traditional mandate pursuant to Code of Civil Procedure section 1085. (See Cadiz Land Co. v. Rail Cycle, L.P. (2000) 83
Cal.App.4th 74, 120 [“Regardless of whether common law principles
under Western States apply or the action is subject to Code of Civil
Procedure section 1094.5, subdivision (e), the
underlying principles in determining whether extra-record evidence is
admissible are essentially the same.”].)
EVIDENTIARY ISSUES
Petitioner requests
judicial notice of Respondent’s opposition to Petitioner’s ex parte application
for a temporary restraining order is granted.
There is no opposition to the request.
The court grants the request under Evidence Code section 452(c).
DISCUSSION
The
dispositive issue in this writ proceeding is not whether Mallard performs
a commercially useful function. Rather,
the dispositive issue is whether DWP’s finding that Mallard performs a
commercially useful function was “arbitrary, capricious, entirely without
evidentiary support, or procedurally unfair,” and whether DWP “adequately
considered all relevant factors” in making this decision. This will entail a review of the information
DWP considered at the time it made the decision. In other words, the court will review the
evidence in the administrative record and determine whether DWP’s finding constitutes
an abuse of discretion. The court agrees
with DWP’s argument that the issue is whether DWP “engaged in misconduct in
approving the contract award to SEP,” not whether SEP or Mallard engaged in
misconduct. (See DWP’s Joinder to Motion
to Quash at 6:19-20.)
It
is undisputed that an administrative hearing was not held in this case. Administrative actions that do not involve
public hearings have often been deemed “informal” such that the general
prohibition on extra-record evidence, or the “closed record rule,” does not
apply. (California Oak Foundation v.
Regents of Univ. of Cal. (2010) 188 Cal.App.4th 227, 255-56.) “[B]ecause
the record upon which a public agency’s informal action is based is often
inadequate to permit meaningful review, the court presiding over traditional
mandamus proceedings challenging the agency’s informal action is generally
permitted to consider extra-record evidence if the facts are in dispute.” (Ibid.) However, an agency is not required to hold a
live, evidentiary hearing in order for the “closed record rule” to apply. (Carrancho v. California Air Resources
Board (2003) 111 Cal.App.4th
1255,1270-71 [“While it is true that neither agency held a formal hearing ...
[t]he trial court correctly ruled that extra-record evidence was not admissible”].)
In this case, there was a sufficient level
of formality to invoke the “closed record rule.” The DWP issued an IFB, and in response,
contractors submitted information to the DWP.
There is an administrative record in this case reflecting the
information the DWP considered. If the
administrative record is lacking, as suggested by Petitioner, that would
benefit Petitioner’s argument that the DWP’s finding was “arbitrary, capricious, entirely without evidentiary support,
or procedurally unfair.”
Petitioner
attempts to involve exceptions that would permit discovery. The California Supreme Court has recognized
an exception for evidence that could not be produced at the administrative
level in the exercise of reasonable diligence, but that still requires
Petitioner to comply with Code of Civil Procedure section 1094.5(e):
Extra-record
evidence is admissible under this exception only in those rare instances in
which (1) the evidence in question existed before the agency made its decision,
and (2) it was not possible in the exercise of reasonable diligence to present
this evidence to the agency before the decision was made so that it could be
considered and included in the administrative record.
(Western
States, supra, 9 Cal.4th at 578.)
Petitioner cannot demonstrate that the depositions or expansive requests
for production satisfy these requirements.
More important, Petitioner seeks to
violate the rule that “extra-record evidence can never be admitted
merely to contradict the evidence that the administrative agency relied on in
making a quasi-legislative decision or to raise a question regarding the wisdom
of that decision.” (Western States,
supra, 9 Cal.4th at 579.) Essentially,
Petitioner seeks to develop evidence that Mallard does not actually perform a
commercially useful function to contradict the evidence upon which DWP relied
in making a contrary finding. This is
not permissible. As discussed, the
dispositive issue is not whether Mallard actually performs a commercially
useful function; the dispositive issue is whether DWP had sufficient evidence
to make that finding.
Petitioner produces an exchange of emails between LADWP and
SEP starting June 21, 2024, 11 days after LADWP denied
Petitioner’s bid protest, which may support Petitioner’s position that LADWP
did not have sufficient information to conclude that Mallard would complete 18% of the 20% SBE/DVBE participation requirement for the
contract. (See Pet. Oppo. 6-7;
Carno Decl. ¶¶ 21-25, Exh. C.) These
documents appear to have been included in the supplemental administrative
record. (Carno Decl. Exh. C.) If not, Petitioner may seek to augment the
record with these emails.
Based
upon the foregoing, the court grants SEP’s motion to quash the subpoenas issued
to Mallard, Mullen, Blue Diamond, and Vulcan.
However, the court agrees that some limited discovery may be
appropriate. Therefore, the court
authorizes the following Requests for Production of Documents (“RPDs”).
A. RPDs to DWP
1. Produce all non-privileged documents
upon which you relied in awarding the contract that are not already contained
within the administrative/supplemental administrative record.
2. Produce all non-privileged documents
upon which you relied in finding that Mallard performs a commercially useful
function that are not already contained within the
administrative/supplemental administrative record.
B. RPDs to SEP
3. Produce all documents you provided to
DWP in connection with your bid, including any in relation to Petitioner’s bid
protest, that are not already contained within the
administrative/supplemental administrative record.
4. Produce all documents you provided to
DWP with respect to the issue whether Mallard performs a commercially useful
function that are not already contained within the
administrative/supplemental administrative record.
CONCLUSION
AND ORDER
Based
upon the foregoing, the court orders as follows:
1. The court grants SEP’s motion to quash
the subpoenas issued to Mallard, Mullen, Blue Diamond, and Vulcan.
2. The court orders SEP and DWP to comply
with the Requests for Production of Documents on or before March 21, 2025. If necessary, Petitioner may file a motion to
augment the administrative record.
3. SEP and DWP shall file a status report discussing
whether any documents were produced in response to these RPDs and, if so, provide
an index of the documents. The joint
status report shall be filed on or before March 21, 2025.
4. The court continues the trial setting
conference to March 28, 2025, at 9:30 a.m.
5. The court’s clerk shall provide
notice.
IT IS SO
ORDERED
Dated:
March 14, 2025 ______________________
Stephen
I. Goorvitch
Superior
Court Judge