California Supreme Court Rejects "Bright Line" Due Process Hearing Rule

BY ROY A. CLARKE

A public agency's administrative hearing process does not violate the rights of an appellant based on the mere appearance of impropriety, a unanimous California Supreme Court confirmed. In Morongo Band of Mission Indians v. State Water Resources Control Board, 45 Cal.4th 731 (2009) (Morongo), the Court rejected a bright line "relationship-bias" rule that would prohibit an agency from relying on its attorney for advice in one matter, when the same attorney advocates or prosecutes an unrelated matter before the same decision maker.

BACKGROUND

Local agencies often use administrative hearings to resolve disputes, such as code enforcement, and appeals in personnel, zoning, planning, and similar matters. An agency conducting adjudicative proceedings must provide for a fair tribunal in which the decision maker is impartial, free of bias for or against a party. Except where an adjudicator has a financial interest in the outcome, this has traditionally required a showing of actual bias and not just an appearance or possibility of bias.

But following the Supreme Court's 2002 decision in Haas v. County of San Bernardino, 37 Cal.4th 310 (2002), outside parties involved in administrative hearings found fertile ground for delaying proceedings and challenging unfavorable decisions based on the relationships between decision makers (such as hearing officers or members of city councils, boards or commissions) and the agency or its attorneys. This caused significant added burden and expense on local agencies. Morongo provides clarification and relief to public agencies.

THE FACTS

In Morongo, the State Water Resources Control Board (Board) initiated administrative proceedings to consider the proposed revocation of a water rights license held by the Morongo tribe. For such proceedings, some agency staff members are assigned to an enforcement team to prosecute the action, while others are assigned to a hearing team, providing advice to the Board. From the limited number of staff attorneys that specialized in water rights, two were assigned, respectively, to the prosecuting and advisory teams in the Morongo case. Agency staff followed formal procedures to assure separation of the prosecution and advice functions, to screen personnel, and to prevent improper ex parte communications with the hearing officer by one party outside the presence of the other.

THE CHALLENGE

Staff Counsel Samantha Olsen was assigned to the Morongo enforcement team and was simultaneously assigned to the advisory team in an unrelated matter involving a different region of the state. The Morongo tribe sought to disqualify Ms. Olsen and the entire enforcement team because of "an inappropriate and impermissible appearance of unfairness and bias sufficient to compel … removal." 45 Cal.4th at 734. They relied on Quintero v. City of Santa Ana, 114 Cal.App.4th 810 (2003), which suggested that once a person serves in the role of neutral adviser to a decision maker, that person could not at the same time, or perhaps even at a later time, serve as a prosecutor or advocate in a different matter.

The Court of Appeal in Morongo accepted this argument, reasoning that "‘[h]uman nature being what it is, the temptation is simply too great for the . . . Board members, consciously or unconsciously, to give greater weight to Attorney Olson's arguments by virtue of the fact she also acted as their legal adviser, albeit in an unrelated matter.'" 45 Cal.4th at 741. To some, Quintero and other cases decided following Haas represented "an evolution of the law in due process jurisprudence." Id. Court of Appeal Slip Opinion, Morongo Band of Mission Indians v. State Water Resources Control Board, C052177 July 12, 2007, at page 9. The Court of Appeal in Morongo attempted to synthesize these recent due process cases into a new "appearance-of-bias" standard to analyze challenges to the impartiality of administrative proceedings. Such a rule would prevent one person from serving as advocate or prosecutor before a decision maker if that person had provided neutral advice or representation in the past. It would also provide a basis to challenge a proceeding in which such a person improperly participated, even if inadvertently. Potentially, it would serve as a bright-line rule prohibiting a person who had served as a neutral advisor from subsequently serving a different role before the same decision maker.

The Quintero and Haas cases, and others that followed, resulted in significant added expense and logistical challenges for public agencies, as they were required to assign or retain, and pay for, multiple attorneys to serve in prosecutorial and advisory roles in pending cases to avoid even the most remote possibility of a perception of bias.

THE SUPREME COURT'S DECISION

The Supreme Court rejected the Court of Appeal's shift to an appearance-of-bias standard and reaffirmed the requirement to show actual bias. The Court distinguished Quintero, noting that in that case, the city's "internal separation of functions had not been maintained" and the attorney had become the "sole or primary legal advisor" for the city's board. Id. at 740. This contrasted with the Water Board in Morongo, where, although limited, there were several water rights attorneys involved. In a footnote, the Supreme Court specifically disapproved any language in Quintero that is inconsistent with the Morongo decision. 45 Cal.4th at 740, fn. 2. The Court concluded:

"In the absence of financial or other personal interest, and when rules mandating an agency's internal separation of functions and prohibiting ex parte communications are observed, the presumption of impartiality can be overcome only by specific evidence demonstrating actual bias or a particular combination of circumstances creating an unacceptable risk of bias." Id. at 741-742. 

CONCLUSION

The Morongo decision is welcome relief for local agencies performing administrative functions with limited resources. It allows more flexibility in the assignment of staff and use of legal counsel. It also reaffirms the presumption that a decision maker will be impartial in reaching a decision, absent proof to the contrary.

FOR ADVICE FROM RW&G ON PERSONNEL HEARING PROCEDURES, PLEASE CONTACT ROY A. CLARKE OR ANY OF THE LAWYERS IN THE FIRM'S LABOR AND EMPLOYMENT DEPARTMENT; FOR GENERAL ADVICE ON PUBLIC ADMINISTRATIVE HEARINGS, PLEASE CONTACT ANY OF THE LAWYERS IN THE FIRM'S PUBLIC LAW DEPARTMENT.

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