gno.law

San Diegans for Open Government v. City of San Diego Public Facilities Financing Authority CA4/1

California Court of Appeal · D067682 · 2016-01-15 · Unpublished

Proceeding
appeal from an order
Trial court
Superior Court of San Diego County · No. 37-2014-00018335-CU-MC-CTL
Trial judge
Ronald L. Styn
Outcome
reversed — Reversed and remanded.
Area
civil
Panel
Richard D. Huffman, Sr. (author), Alex C. McDonald, Gilbert Nares

Analysis

A model's reading — qwen3.8-27b, prompt v1, 2026-10-13T06:00Z · confidence high

The trial court dismissed a reverse validation action and denied a subsequent motion for relief under Code of Civil Procedure section 473, ruling that the plaintiff's failure to strictly comply with the service deadline in Government Code section 6599(a) divested the court of subject matter jurisdiction. The Court of Appeal reversed, holding that the service requirement is not jurisdictional and that the trial court erred by refusing to consider the section 473 motion on its merits.

Ruling reviewedStandardThe courtThe model
Denial of plaintiff's motion for relief from judgment under Code of Civil Procedure section 473 based on lack of subject matter jurisdiction.
“Because section 6599(a) is not jurisdictional, we conclude the court erred by denying SDOG's motion for relief under Code of Civil Procedure section 473 on the ground it lacked subject matter jurisdiction.”
de novoerroragree with court
The appellate court correctly applied the de novo standard of review to the question of subject matter jurisdiction. It relied on its prior published decision in San Diegans for Open Government v. City of San Diego (SDOG I) to establish that the service requirement in Government Code section 6599(a) is mandatory but not jurisdictional. Consequently, the trial court's refusal to hear the section 473 motion on the ground of lack of jurisdiction was a misapplication of law, as the court retained the power to consider the motion on its merits.

Authorities

  • relied: San Diegans for Open Government v. City of San Diego (SDOG I) (2015) 242 Cal.App.4th 416 — Noncompliance with Government Code section 6599(a) does not deprive the court of subject matter jurisdiction; the court has discretion to excuse late service if there is no prejudice to the Attorney General and Treasurer.
  • relied: Saffer v. JP Morgan Chase Bank (2014) 225 Cal.App.4th 1239 — Subject matter jurisdiction is the power of the court over a cause of action or to act in a particular way.
  • relied: People v. National Automobile & Casualty Ins. Co. (2000) 82 Cal.App.4th 120 — Lack of jurisdiction in its most fundamental sense means an entire absence of power to hear or determine the case.
  • relied: People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653 — When a court lacks jurisdiction in a fundamental sense, an ensuing judgment is void and vulnerable to direct or collateral attack at any time.
  • relied: Tearlach Resources Limited v. Western States International, Inc. (2013) 219 Cal.App.4th 773 — Questions of subject matter jurisdiction are questions of law, which are reviewed de novo.
  • relied: People v. Hill (1984) 37 Cal.3d 491 — Factual conflicts regarding the merits of a motion for relief under Code of Civil Procedure section 473 are to be won or lost at the trial level.
  • relied: Rider v. City of San Diego (1998) 18 Cal.4th 1035 — State and local debt limitations are inapplicable to a lease-back financing plan where bonds are issued by a separate public entity formed under a joint powers agreement, rather than the city itself.

The appellate opinion: sound — The opinion is sound because it correctly applies the de novo standard of review to the jurisdictional question and relies on a binding, published precedent from the same division (SDOG I) to establish that the statutory service requirement is not jurisdictional. The court properly distinguishes between mandatory procedural steps and jurisdictional requirements, ensuring that the trial court retains the authority to consider the section 473 motion on its merits.

How this analysis was made · dispute it

unusual disposition

A model's reading — claude-fable-5-1, prompt v1, 2026-10-13T04:31Z · confidence low

The trial court dismissed San Diegans for Open Government's reverse validation action for lack of subject matter jurisdiction because the Attorney General and Treasurer were served after the first publication of summons as required by Government Code section 6599(a), and then denied SDOG's Code of Civil Procedure section 473 motion for relief on the same jurisdictional ground. The Court of Appeal, relying on its intervening published decision in SDOG I holding section 6599(a) is not jurisdictional, reversed and remanded for the trial court to consider the section 473 motion on its merits, adding that the moving party must also prove lack of prejudice to the State from the late service.

Ruling reviewedStandardThe courtThe model
Denial of SDOG's Code of Civil Procedure section 473 motion for relief from dismissal on the ground that noncompliance with the service deadline of Government Code section 6599(a) deprived the court of subject matter jurisdiction
“Because section 6599(a) is not jurisdictional, we conclude the court erred by denying SDOG's motion for relief under Code of Civil Procedure section 473 on the ground it lacked subject matter jurisdiction.”
de novoerror (statutory interpretation)agree with court
Subject matter jurisdiction is a question of law reviewed de novo, and the same division had already held in the published SDOG I decision (242 Cal.App.4th 416) that section 6599(a) is a mandatory but non-jurisdictional procedural requirement, applying the settled distinction between mandatory procedural steps and fundamental jurisdiction and the canon against absurd results. Given that binding published holding, the trial court's premise that it had no power to entertain a section 473 motion was wrong, so reversal follows directly.
The City's alternative argument that relief under section 473 would be improper on the merits because counsel's failure to recognize the Marks-Roos Act was inexcusable professional negligence, and its factual challenge to whether service occurred on July 7 or August 7, 2014
“It is, of course, not our province to consider the substantive merits of a motion for relief under Code of Civil Procedure section 473 in the first instance.”
unclearnot reachedagree with court
The court properly declined to decide in the first instance whether counsel's neglect was excusable or whether the State was prejudiced, since the trial court never exercised its discretion and the date-of-service question involves a factual conflict (one the City itself conceded as undisputed in its summary judgment papers). Leaving these for the trial court on remand is consistent with ordinary appellate practice, though the court did not address whether the mandatory attorney-fault provision of section 473(b) can apply to a dismissal entered on summary judgment.

Authorities

  • relied: San Diegans for Open Government v. City of San Diego (2015) 242 Cal.App.4th 416 — Government Code section 6599(a)'s requirement of service on the Attorney General and Treasurer by the first day of publication of summons is mandatory but not jurisdictional; the court has discretion to excuse late service where the State is not prejudiced; and under Rider the lease-back financing plan is not subject to constitutional and charter debt limits.
  • relied: Tearlach Resources Limited v. Western States International, Inc. (2013) 219 Cal.App.4th 773 — Questions of subject matter jurisdiction are questions of law reviewed de novo.
  • relied: People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653 — When a court lacks jurisdiction in a fundamental sense the ensuing judgment is void and subject to direct or collateral attack at any time.
  • relied: Saffer v. JP Morgan Chase Bank (2014) 225 Cal.App.4th 1239 — Subject matter jurisdiction is the power of the court over a cause of action or to act in a particular way.
  • relied: People v. National Automobile & Casualty Ins. Co. (2000) 82 Cal.App.4th 120 — Lack of jurisdiction in its fundamental sense means an entire absence of power to hear or determine the case.
  • relied: People v. Hill (1984) 37 Cal.3d 491 — Factual conflicts are to be won or lost at the trial level, not resolved by the appellate court in the first instance.
  • relied: Rider v. City of San Diego (1998) 18 Cal.4th 1035 — Bonds issued by a separate joint powers financing authority, rather than the city itself, are not subject to the constitutional two-thirds voter approval debt limitation.
  • missed: English v. IKON Business Solutions, Inc. (2001) 94 Cal.App.4th 130 — The mandatory attorney-fault relief provision of Code of Civil Procedure section 473(b) does not apply to a summary judgment; it is limited to defaults, default judgments, and dismissals analogous to defaults. The opinion directs the trial court to consider SDOG's section 473 motion, including its mandatory-relief theory, without noting this limitation on relief from a dismissal entered via summary judgment.

The appellate opinion: sound with gaps — The core holding is compelled by the division's own published decision in SDOG I and is supported by the standard distinction between mandatory procedural requirements and fundamental jurisdiction, and the court correctly left the discretionary and factual questions to the trial court on remand. The opinion skips whether section 473(b)'s mandatory attorney-fault provision can reach a dismissal entered on summary judgment, grafts a lack-of-prejudice burden onto section 473 with little textual grounding, and reverses the 'judgment' although the appeal was taken only from the postjudgment order.

How this analysis was made · dispute it

Opinion

Filed 1/15/16 San Diegans for Open Government v. City of San Diego Public Facilities Financing Authority CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

SAN DIEGANS FOR OPEN D067682 GOVERNMENT,

Plaintiff and Appellant, (Super. Ct. No. 37-2014-00018335- v. CU-MC-CTL)

CITY OF SAN DIEGO PUBLIC FACILITIES FINANCING AUTHORITY et al., Defendants and Respondents.

APPEAL from an order of the Superior Court of San Diego County, Ronald L.

Styn, Judge. Reversed and remanded.

Briggs Law Corporation, Cory J. Briggs, Anthony N. Kim and Kelly E. Mourning for Plaintiff and Appellant.

Jan I. Goldsmith, City Attorney, Daniel F. Bamberg and Meghan Ashley Wharton, Deputy City Attorneys, for Defendants and Respondents. In a validation action or reverse validation action challenging bonds issued under the Marks-Roos Local Bond Pooling Act of 1985 (Gov. Code, § 6584 et seq.), Government Code section 6599, subdivision (a) (section 6599(a)) requires the plaintiff to serve a copy of the complaint on the Attorney General and the Treasurer "by the first day of the publication of summons . . . ." Section 6599(a) also provides: "A court may render no judgment in the matter or grant other permanent relief to any party except on proof of service of the Attorney General and the Treasurer as required by this section."

Here, the trial court dismissed a reverse validation action brought by San Diegans for Open Government (SDOG) against the City and related entities, to challenge a lease- back financing mechanism, on the ground SDOG's noncompliance with the time limitation of section 6599(a) divested it of subject matter jurisdiction. The court also denied SDOG's postjudgment motion for relief under Code of Civil Procedure section 473, again on the ground it lacked jurisdiction to consider the matter because of SDOG's failure to strictly comply with section 6599(a). SDOG appeals that order, contending the court erred by finding the time limitation of section 6599(a) is jurisdictional.

While this appeal was pending, we held in a related action, San Diegans for Open Government v. City of San Diego (2015) 242 Cal.App.4th 416 (SDOG I), that section 6599(a) is not jurisdictional, and the court has discretion to consider whether late service should be excused on the ground of lack of prejudice to the Attorney General and the Treasurer. (SDOG I, at p. 432.) Here, we conclude that because section 6599(a) is not jurisdictional, the court erred by denying SDOG's motion under Code of Civil Procedure section 473 on the ground of lack of jurisdiction. We reverse the order and remand the 2 matter for a new hearing under Code of Civil Procedure section 473. We also clarify that Code of Civil Procedure section 473 is a proper mechanism for moving for relief from the failure to strictly comply with section 6599(a), and the moving party must not only comply with the provisions of Code of Civil Procedure section 473, but must also prove lack of prejudice to the State as a result of the delay.

FACTUAL AND PROCEDURAL BACKGROUND

On June 6, 2014, SDOG filed a reverse validation action (Code Civ. Proc., § 860)

against the City of San Diego, the Redevelopment Agency of the City of San Diego, the Housing Authority of the City of San Diego, and the Public Facilities Financing Authority of the City of San Diego (Financing Authority) (collectively, the City). The complaint alleges a lease-back financing plan the City adopted to fund public infrastructure projects violates the law in numerous respects, including the requirement that municipal indebtedness exceeding annual income and revenue be approved by a two- thirds vote of the electorate. (Cal. Const., art. XVI, § 18, subd. (a); San Diego City Charter, art. VII, § 90(a).) According to the complaint, the City's use of the Financing Authority "to issue bonds . . . instead of [the City] issuing the bonds in its own name, is an artifice designed to circumvent the voter-assent requirement."

SDOG first published the summons on June 17, 2014. SDOG did not comply with section 6599(a) by serving a copy of the complaint on the Attorney General and the Treasurer on or before that date. In September 2014, SDOG filed a proof of service that states it served the Attorney General and the Treasurer with a copy of the complaint on 3 July 7, 2014. The proof of service was signed by an employee of the firm representing SDOG, Briggs Law Corporation, on August 7, 2014.

In October 2014, the City moved for summary judgment on the merits, and also on the ground the court lacked subject matter jurisdiction because of SDOG's failure to strictly comply with the time limitation of section 6599(a). The City's separate statement claims it is undisputed that SDOG "finally served" the Attorney General and the Treasurer "late on July 7, 2014." The City cited SDOG's proof of service dated August 7, 2014.

After a hearing in January 2015, the court granted the City's motion without reaching the merits of the complaint. The court determined it lacked subject matter jurisdiction under section 6599(a) because SDOG did not serve the Attorney General and the Treasurer with a copy of the complaint until July 7, 2014. On January 12, 2015, the court entered a judgment of dismissal with prejudice.

In late January 2015, SDOG brought a motion for relief from the dismissal under Code of Civil Procedure section 473.1 SDOG argued the court "should grant the motion on discretionary grounds because [p]laintiff's counsel's mistake in not notifying the 1 Code of Civil Procedure section 473, subdivision (b) provides: "The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. . . . Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney's sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any . . . (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect." 4 Attorney General and the Treasurer about this lawsuit within the time limits prescribed by . . . [s]ection 6599[(a)] was reasonable, and the notice requirement is not jurisdictional such that [Code of Civil Procedure] [s]ection 473 relief is unavailable." Alternatively, SDOG argued the court was required to grant relief because its counsel, Cory J. Briggs, "has submitted a declaration admitting fault for the delay in notification."

After a hearing, the court denied the motion on the ground SDOG's failure to strictly comply with section 6599(a) divested it of jurisdiction to consider the matter.

The court explained: "If there's no jurisdiction, you can't use [Code of Civil Procedure]

[s]ection 473." This appeal of the order followed, and we granted SDOG's request for calendar preference.

DISCUSSION

I

SDOG contends the court erred by denying its motion for relief under Code of Civil Procedure section 473 on the ground the noncompliance with the time limitation of section 6599(a) deprives the court of subject matter jurisdiction. We agree.

" ' "Subject matter jurisdiction . . . is the power of the court over a cause of action or to act in a particular way." ' " (Saffer v. JP Morgan Chase Bank (2014) 225 Cal.App.4th 1239, 1248.) " 'Lack of jurisdiction in its most fundamental or strict sense means an entire absence of power to hear or determine the case, an absence of authority over the subject matter or the parties.' " (People v. National Automobile & Casualty Ins.

Co. (2000) 82 Cal.App.4th 120, 125.) "When a court lacks jurisdiction in a fundamental sense, an ensuing judgment is void, and 'thus vulnerable to direct or collateral attack at 5 any time.' " (People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 660.)

"Questions of subject matter jurisdiction are questions of law, which are reviewed de novo." (Tearlach Resources Limited v. Western States International, Inc. (2013) 219 Cal.App.4th 773, 780.)

While this appeal was pending, we held in a related case, SDOG I, supra, 242 Cal.App.4th at pages 431 to 432, that noncompliance with section 6599(a) does not deprive the court of subject matter jurisdiction. We need not repeat our entire analysis in SDOG I, but in summary, we explained that section 6599(a) does not expressly require dismissal absent strict compliance (SDOG I, at p. 429), and the legislative history does not support such an interpretation (SDOG I, at p. 430). Rather, the legislative history shows section 6599 was enacted in 2000 as part of Assembly Bill No. 2300 to " '[c]lose loopholes in the sale of land-based municipal bonds issued by "roving" joint powers authorities,' " which were "established to sell bonds under the Marks-Roos Act for the financing of projects by developers in exchange for substantial fees." (SDOG I, at p. 430.) The Legislature was concerned that "[s]tate officials . . . don't hear about validation suits over roving joint powers agencies' Marks-Roos Act bonds until it's too late to respond effectively." (SDOG I, at p. 431, original italics.)

We also noted: "Under the City's theory, an action would be subject to mandatory dismissal if service on the Attorney General and the Treasurer were even a day late and no prejudice resulted, i.e., they had sufficient time to intervene or perhaps even did intervene. We cannot reasonably attribute that intent to the Legislature, particularly because the validation statutes 'implement[] important policy considerations.' " (SDOG I, 6 supra, 242 Cal.App.4th at p. 431.) We concluded that "[t]o any extent a literal interpretation of [section 6599(a)] supports the City's position, . . . we decline to adopt [it]

because it would lead to unintended and absurd results. The time for service set forth in the statute is mandatory and should, of course, be observed. However, '[m]ost procedural steps, including those regarded as "mandatory," are not jurisdictional. Errors or omissions in compliance with them are not fatal to the fundamental subject matter jurisdiction of the court [citation] or to its jurisdiction to act.' " (SDOG I, at p. 431.)

Because section 6599(a) is not jurisdictional, we conclude the court erred by denying SDOG's motion for relief under Code of Civil Procedure section 473 on the ground it lacked subject matter jurisdiction. The court should have considered SDOG's motion on its merits, as when service on the Attorney General and the Treasurer is late under section 6599(a), Code of Civil Procedure section 473 provides a proper mechanism for seeking relief from the consequences. We also clarify that in such a motion, the moving party has the burden of proving the Attorney General and the Treasurer were not prejudiced by the late service.

II

The City contends that even if the court had considered the merits of SDOG's motion under Code of Civil Procedure section 473, it "would have dismissed the action because the evidence presented by SDOG established that relief . . . is improper in this case." The City elaborates that the evidence SDOG presented shows Briggs's "failure to recognize the applicability of the Marks-Roos Act prior to initiating the [action]

7 constituted professional negligence that cannot be excused." The City asserts SDOG's only recourse is a malpractice action against Briggs.

Insofar as the issue of prejudice is concerned, the City also questions whether SDOG served the Attorney General and the Treasurer with a copy of the complaint on July 7, 2014. The City states the evidence "clearly demonstrates that SDOG delayed serving" those parties until August 7, 2014, which it claims was "after the August 5, 201[4] deadline to join the action." The City ignores that in its summary judgment motion, it agreed it was undisputed that SDOG served them on July 7, 2014. In any event, this is a factual issue for the trial court's consideration on remand.

It is, of course, not our province to consider the substantive merits of a motion for relief under Code of Civil Procedure section 473 in the first instance. That is the trial court's duty on remand. A "factual conflict [is] to be won or lost at the trial level."

(People v. Hill (1984) 37 Cal.3d 491, 499.)2 2 Even if SDOG prevails on remand on its motion under Code of Civil Procedure section 473, it will presumably be a hollow victory. In SDOG I, we held that under Rider v. City of San Diego (1998) 18 Cal.4th 1035, state and local debt limitations are inapplicable to a lease-back financing plan the City adopted to fund public infrastructure improvements, because the bonds will not be issued by the City, but by a separate public entity, the Financing Authority, formed under a joint powers agreement. (SDOG I, supra, 242 Cal.App.4th at pp. 432-442.) In SDOG I, the 2014A Bond Series was at issue. (Id. at p. 425.) Here, SDOG challenges the 2014B Bond Series, which pertains to the same financing plan. 8 DISPOSITION The judgment is reversed, and the matter is remanded to the trial court for further proceedings on SDOG's motion under Code of Civil Procedure section 473. SDOG is entitled to costs on appeal.

HUFFMAN, Acting P. J.

WE CONCUR:

NARES, J.

MCDONALD, J.

Cites, in this corpus