Thursday, March 21, 2013
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C.A. Reinstates Attorney General’s Suit Against Ex-Bell Officials
Ruling Adds to Woes of Defendants, Four of Whom Were Convicted of Crimes Yesterday
By KENNETH OFGANG, Staff Writer
The state attorney general has authority to sue city officials in order to recover unauthorized compensation, the Court of Appeal for this district ruled yesterday.
The decision of Div. Three, reinstating Attorney General Kamala Harris’ suit against former officials of the City of Bell, was handed down the same day that a Los Angeles Superior Court jury found four of those defendants guilty of multiple corruption charges.
The civil action was filed by then-Attorney General Jerry Brown in 2010, naming former City Administrator Robert Rizzo, former Assistant City Administrator Angela Spaccia, former Police Chief Randy Adams, and former council members Luis Artiga, Victor Bello, George Cole, Oscar Hernandez, Teresa Jacobo and George Mirabal as defendants. It seeks the return of more than $5 million in excessive salary to the city and the appointment of a receiver. The complaint alleges causes of action for waste of taxpayer funds, negligence (against Rizzo and the ex-council members only) fraud (also against Rizzo and the ex-council members only), conflict of interest (against Rizzo and Spaccia only), and breach of fiduciary duty.
Harris continued to press the suit after Brown was elected governor and Harris succeeded him.
Mixed Verdicts
The former council members, with the exception of Artiga—who was acquitted on all charges—were found guilty of some charges and acquitted of others by yesterday’s verdict. Rizzo and Spaccia are awaiting trial on charges that include misappropriating public funds, conflict of interest, and falsifying and secreting public documents, as well as defrauding taxpayers by inflating their salaries and benefits and making illicit loans of public money.
Adams, who is alleged to have received an excessive salary—more than $17,000 monthly—but not to have solicited or approved it or conspired with the other defendants, has not been charged with a crime.
In sustaining demurrers to the civil complaint, Superior Court Judge Ralph W. Dau said that because of legislative immunity, the council members could not be sued for passing ordinances that awarded them the higher salaries, including compensation for serving on boards that allegedly were created illegally and rarely, if ever, met.
Dau also cited the separation of powers, saying the judicial branch could not determine the wisdom of legislative decisions.
Ultra Vires Acts Alleged
Croskey, however, said the defendants were protected from civil liability only to the extent that the law actually gave them discretion to do what they did. Because the complaint alleges ultra vires acts, the justice wrote, it was error to sustain the demurrers.
The justice explained:
“In sum, the doctrines of separation of powers, legislative immunity, and discretionary act immunity prevent courts from considering the wisdom of legislative and executive decisions, including those pertaining to compensation, which have been entrusted to the discretion of municipal authorities. There can be no liability for such a decision when made within the discretion of such officials. However, if the decision made was outside the authority of the officials – either as an ordinance outside of the city council’s authority under the charter, or a contract made by someone without the authority to bind the city to it – courts can strike down the ordinance or contract as void. If that occurs, the recipient of funds under the void ordinance or contract may be liable to the city in restitution, and the city officials who purported to authorize the unauthorized expenditure may also be liable in restitution if they failed to use due care or reasonable diligence in authorizing it.”
Some of the conduct alleged in the complaint, such as that the council members were negligent in approving Rizzo and Spaccia’s contracts, is clearly protected by immunity, Croskey acknowledged. But other alleged conduct, such as council members violating the city’s charter by approving compensation for Rizzo that exceeded that “commensurate with his responsibilities” and by granting themselves salaries in excess of those provided for by general law, could be found “so palpably unreasonable and arbitrary” as to be ultra vires and illegal.
The case is People ex rel. Harris v. Rizzo, B236246.
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