Tuesday, December 4, 2007
Claim Must Be Filed Before Suing Government for Breach of Contract, Supreme Court Rules
By a MetNews Staff Writer
The “Tort Claims Act,” generally requiring the filing of a demand prior to the institution of litigation against a governmental entity, applies to contract actions, the California Supreme Court held yesterday, abolishing that shorthand title.
In a unanimous opinion by Justice Carol Corrigan, it adopted the view expressed by this district’s Court of Appeal in the 1999 case of Baines Pickwick Ltd. v. City of Los Angeles, 72 Cal.App.4th 298.
Affirming an unpublished 2005 decision of the Third District Court of Appeal, yesterday’s opinion said:
“Government Code section 905 requires that ‘all claims for money or damages against local public entities’ be presented to the responsible public entity before a lawsuit is filed. Failure to present a timely claim bars suit against the entity. (§ 945.4.) Here we hold that these requirements apply to breach of contract claims.”
The plaintiff in the case—a developer suing the City of Stockton for breach of contract—pointed to Government Code §814 which provides:
“Nothing in this part affects liability based on contract or the right to obtain relief other than money or damages against a public entity or public employee.”
“It is true that some Courts of Appeal have read section 814 to exclude contract causes of action from the scope of the claim requirements....Others, however, have rejected that view, reasoning that section 814 pertains only to immunity from liability, and has no effect on the claims requirements....This reasoning finds ample support in the language, structure, and purpose of the statute.”
Prior to the 1999 Court of Appeal opinion, it was generally supposed that the act applied only to tort claims. In her decision for Div. Three, Presiding Justice Joan Dempsey Klein commented:
“The commonly used label, Tort Claims Act, applying to section 810 et seq., has led to confusion among trial and appellate courts in determining the applicability of the government claims presentation statutes to contract claims.”
To end that confusion, yesterday’s Supreme Court decision adopted a suggestion Klein made, declaring:
“Because of the broad scope of the claim requirements, a number of Courts of Appeal have followed the suggestion in Baines Pickwick that ‘Government Claims Act’ is a more appropriate short title than the traditional ‘Tort Claims Act.’...We agree that this practice is a useful way to reduce confusion over the application of the claim requirements. Henceforth, we will refer to division 3.6, parts 1 through 7 of the Government Code (§ 810 et seq.) as the Government Claims Act.”
Spurning the ruling in Pickwick Ltd., Sacramento Superior Court Judge Jeffrey L. Gunther had overruled a demurrer by the city which was based on noncompliance with the claims statute. The Court of Appeal issued a writ of mandate ordering him to sustain the demurrer.
Affirming, the Supreme Court added that the developer must be granted leave to amend in order to avert, if it can, the city’s defense based on the failure to file a claim.
The case is City of Stockton v. Superior Court, published in today’s S.O.S. at 7005.
Copyright 2007, Metropolitan News Company