San Diego County Water Auth. v. Metropolitan Water Dist. of So. Cal. CA1/3 ( 2021 )

Filed 9/21/21 San Diego County Water Auth. v. Metropolitan Water Dist. of So. Cal. CA1/3
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California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
SAN DIEGO COUNTY
WATER AUTHORITY,
A161144
Plaintiff and Respondent,
v. (City and County of San Francisco
Super. Ct. Nos. CPF10510830 &
METROPOLITAN WATER CPF12512466)
DISTRICT OF SOUTHERN
CALIFORNIA, et al.,
Defendants and
Appellants.
Metropolitan Water District of Southern California (Metropolitan)
appeals from a judgment and peremptory writ of mandate, which were
entered after the remittitur issued following its appeal in San Diego County
Water Authority v. Metropolitan Water Dist. of Southern California (2017) 12
Cal.App.5th 1124 (SDCWA v. MWD). We affirm.
FACTS 1
1 On appeal, Metropolitan has filed a request for judicial notice of certain
pleadings filed by the San Diego County Water Authority (Water Authority)
in three other pending superior court actions between the parties. The Water
Authority has also filed a request for judicial notice regarding certain
1
Our factual and procedural background is taken, in part, from our prior
opinion in SDCWA v. MWD, supra, 12 Cal.App.5th 1124.
A. Background
Metropolitan, established by statute in 1928, repealed and reenacted in
1969 (Stats. 1969, ch. 209, §§ 1,2, p. 492, West’s Ann. Wat.-Appen. (1995 ed.)
§§ 109-1 et. seq.2), was formed to “ ‘construct and operate the 242-mile
Colorado River Aqueduct’ to transport Colorado River water” to cities and
communities in Southern California. (SDCWA v. MWD, supra, 12
Cal.App.5th at p. 1131.) “Today, Metropolitan imports water from two
principal sources, the Colorado River, using its Colorado River Aqueduct, and
Northern California via the state-owned California Aqueduct,” and delivers
the water to a voluntary collective of 26-member public agencies, including
the Water Authority. (Ibid.) In turn, the Water Authority “delivers the
water to retail water agencies serving households and businesses in San
Diego County.” (Id. at p. 1130.)
“The Water Authority has no means of transporting Colorado River
water other than over Metropolitan’s aqueduct and thus opened negotiations
documents (pleadings and orders) filed in one of those superior court actions.
We deny both parties’ requests as those documents are not necessary to the
resolution of this appeal. (Hughes Electronics Corp. v. Citibank Delaware
(2004) 120 Cal.App.4th 251, 266, fn. 13 [“[a]s a general matter, judicial notice
is not taken of matters irrelevant to the dispositive points on appeal”].)
Metropolitan also seeks judicial notice of certain proceedings before its
Board of Directors concerning the repeal of section 4405 of Metropolitan’s
Administrative Code. We grant the request. (See Evans v. City of Berkeley
(2006) 38 Cal.4th 1, 7, fn. 2 [judicial notice proper for city council resolution];
Evid. Code, § 452, subd. (b) [judicial notice permissible for “legislative
enactments issued by or under the authority of . . . any public entity in the
United States”].)
2 All citations to Water Code Appendix sections are to uncodified acts
reprinted at 72B West’s Annotated Water Code Appendix.
2
with Metropolitan to transport, or ‘wheel’ . . . water. ‘Wheeling’ is the
industry term for ‘[t]he use of a water conveyance facility by someone other
than the owner or operator to transport water.’ [Citation.] California law
mandates that the owner or operator of a water conveyance facility allow
others to use up to 70 percent of the facility’s unused capacity to transport
water upon payment of ‘fair compensation.’ ” (SDCWA v. MWD, supra, 12
Cal.App.5th at p. 1135; see Wat. Code, §§ 1810, 1814.) “Metropolitan and the
Water Authority failed to reach a wheeling agreement but they did reach a
functionally related water exchange agreement” in 1998. (SDCWA v. MWD,
supra, at p. 1135.) Five year later, “in 2003, Metropolitan and the Water
Authority executed an amended exchange agreement,” in which “the parties
agreed to an initial price with future prices linked to standard water rates,
lawfully set. The parties agreed: ‘The price on the date of execution of this
agreement shall be two hundred fifty three dollars ($253.00) [per acre-foot].
Thereafter, the price shall be equal to the charge or charges set by
Metropolitan’s Board of Directors pursuant to applicable law and regulation
and generally applicable to the conveyance of water by Metropolitan on
behalf of its member agencies.’ ” (Id. at pp. 1136-1137, fn. omitted.)
“Metropolitan is required by statute to establish rates that will
generate sufficient revenue to pay its expenses. (Stats. 1969, ch. 209, §134, p.
506, West’s Ann. Wat.-Appen., supra, § 109-134, p. 40.) [3]” (SDCWA v.
3 “Water Code Appendix section 109-134 provides, in relevant part:
Metropolitan’s board ‘shall fix such rate or rates for water as will result in
revenue which, together with revenue from any water standby or availability
service charge or assessment, will pay the operating expenses of the district,
provide for repair and maintenance, provide for payment of the purchase
price or other charges for property or services or other rights acquired by the
district, and provide for the payment of the interest and principal of the
bonded debt’ Metropolitan incurs. (Stats. 1969, ch. 209, § 134, p. 506, West’s
Ann. Wat.-Appen., supra, § 109-134, p. 40.)”
3
MWD, supra, 12 Cal.App.5th at p. 1137.) “For years, Metropolitan utilized a
single water service rate. In 1998, Metropolitan began a lengthy process to
replace the single rate with a new rate structure allocating charges to
separate cost components, including water supply and transportation.” (Id.
at p. 1137.) “Metropolitan’s water service rates are now a combination of
component rates calculated to recover its costs incurred in purchasing and
transporting water to its member agencies.” (Id. at p. 1138.)
The “ ‘supply’ rates are calculated to recover costs incurred in
purchasing water supply from the State Water Project and Colorado River
and in maintaining and developing additional water supplies through
transfers and other transactions.” (SDCWA v. MWD, supra, 12 Cal.App.5th
at p. 1138.) The “transportation rates are designed to recover the costs of
operating and maintaining [Metropolitan’s] vast water conveyance
infrastructure,” and consist of three subcomponents –the “ ‘system access
rate,’ ” the “ ‘system power rate,’ ” and a “ ‘water stewardship rate.’ ” (Id. at
p. 1138.) Two subcomponents are of relevance here. The “ ‘system access
rate’ is designed to recover the capital, operating, and maintenance costs
associated with transportation facilities, including ‘conveyance’ facilities that
transport water from the State Water Project and Colorado River Aqueduct
and ‘distribution’ facilities that transport water within Metropolitan’s service
area. (Former Admin. Code, § 4123.) . . . A ‘water stewardship rate’ is
designed to recover the costs of conservation programs and other water
management programs that reduce and defer system capacity expansion
costs. (See former Admin. Code, § 4124.)” (SDCWA v. MWD, supra, 12
Cal.App.5th at p. 1138.)
“Metropolitan provides both full service, in which it supplies and
transports water, and wheeling service, in which it transports water supplied
4
by others. . . . The full-service rate includes the supply rate, system access
rate, system power rate, and water stewardship rate. The wheeling rate
includes the system access rate and water stewardship rate. [Citation.] A
recipient of wheeling service does not pay the system power rate but pays
only the actual cost of the power used to transport the water it receives from
a third party. [¶] Under the exchange agreement as amended in 2003, the
Water Authority agreed to pay charges ‘generally applicable to the
conveyance of water by Metropolitan on behalf of its member agencies’ which,
the parties agree, are the system access rate, water stewardship rate and,
unlike under a standard wheeling agreement, the system power rate.”
(SDCWA v. MWD, supra, 12 Cal.App.5th at pp. 1138-1139.)
“During the administrative process in which Metropolitan’s rates were
established, the Water Authority challenged the propriety of applying the
system access and water stewardship rates to the wheeling service.
Metropolitan’s general manager responded that a system access rate was
adopted, rather than individual aqueduct access rates, because
‘Metropolitan’s system is not a point-to-point service, but an interconnected
regional system.’ . . . [¶] As to the water stewardship rate – ‘a volumetric
charge upon all water moved through the system that provides a dedicated
source of funding for conservation and local resources development’ –
Metropolitan’s general manger asserted that all users benefit from water
conservation and thus all users are properly charged for it . . . .” (SDCWA v.
MWD, supra, 12 Cal.App.5th at p. 1139.)
B. Initial Trial Court Proceeding
“In June 2010, the Water Authority filed its initial action challenging
the water rates Metropolitan adopted in April 2010 for 2011 to 2012. In June
2012, the Water Authority filed a second action challenging Metropolitan’s
5
2013-2014 rates. The Water Authority also sought damages for breach of
contract of the provision in the amended water exchange agreement
providing that ‘the price shall be equal to the charge or charges set by
Metropolitan’s Board of Directors pursuant to applicable law and regulation
and generally applicable to the conveyance of water by Metropolitan on
behalf of its member agencies.’ The Water Authority maintained that
Metropolitan’s rates [were] not lawful conveyance rates [due to the inclusion
of the costs subcomponents of its transportation rates, in relevant part here,
the system access rate and the water stewardship rate], and, thus, not
properly charged under the amended agreement.” (SDCWA v. MWD, supra,
12 Cal.App.5th at pp. 1139-1140.)
“The [trial] court informally coordinated the 2010 and 2012 cases and
bifurcated the bench trial. The court first determined the validity of
Metropolitan’s water rates and then decided the contract claim. . . . [¶] In
phase one, the court found ‘no substantial evidence to support
Met[ropolitan]’s inclusion in its transportation rates, and hence in its
wheeling rate, of 100% of (1) the [system access rate which represented] sums
it pays to the California Department of Water Resources [for the State Water
Project] disaggregated by the [State Water Project] as for transportation of
that purchased water; and (2) the costs for conservation and local water
supply development programs recovered through the Water Stewardship
Rate. . . . [T]hese rates over-collect from wheelers, because at least a
significant portion of these costs are attributable to supply, not
transportation. These rates – the System Access Rate . . . , Water
Stewardship Rate, and Met[ropolitan]’s wheeling rate – therefore violate . . .
the wheeling statutes [(Wat. Code, § 1810 et. seq.] . . . and the common law.
The court invalidates each rate for both the 2011-2012 and 2013-2014 rate
6
cycles.’ [¶] In phase two, the . . . court found that Metropolitan had breached
the price term of the 2003 exchange agreement because it charged the Water
Authority transportation rates that were not ‘consistent with law and
regulation.’ The court awarded the Water Authority damages equal to the
total amount the water agency paid under the exchange agreement from 2011
to 2014 for State Water Project costs and the water stewardship rate.”
(SDCWA v. MWD, supra, 12 Cal.App.5th at pp. 1140-1141.) The court
entered judgment in favor of the Water Authority and issued a peremptory
writ of mandate in accordance with its statement of decision.
C. Metropolitan’s Appeal
On appeal, Metropolitan challenged portions of the judgment and the
peremptory writ of mandate. (SDCWA v. MWD, supra, 12 Cal.App.5th 1124.)
Finding the central issue in dispute was one of cost allocation, we concluded:
“The inclusion of Metropolitan’s system-wide transportation costs, including
transportation charges paid to the State Water Project, in the calculation of
its wheeling rate does not, as the trial court held, violate the wheeling
statutes, Proposition 26 (Cal. Const., art. XIIIC, § 1, subd. (e)), Government
Code section 54999.7, subdivision (a), the common law, or the terms of the
parties’ exchange agreement.” (SDCWA v. MWD, supra, at p. 1130.)
However, we agreed “with the trial court that the allocation of ‘water
stewardship’ charges to the wheeling rate” was improper under the wheeling
statutes and the common law, and therefore, the Water Authority was
“entitled to recover the overcharges that resulted from inclusion” of the water
stewardship charges in the rate charged by Metropolitan under the parties’
exchange agreement. (Ibid.)
We specifically found there was no substantial evidence that the water
stewardship rate used to fund conservation programs was recoverable as
7
“ ‘fair compensation’ ” for use of the water conveyance system, under the
wheeling statutes (Wat. Code, § 1811, subd. (c)). (SDCWA v. MWD, supra, 12
Cal.App.5th at p. 1151.) We also held, as did the trial court, that because the
water stewardship rate was supply related, not transportation related, its
inclusion as a component of the wheeling rate and exchange agreement
transportation rates was in violation of the common law rule that “rates are
invalid if they are not based ‘on the cost of services or some other reasonable
basis.’ ” (Ibid.)
Lastly, we agreed with the trial court that, “to the extent that the price
Metropolitan charged the Water Authority for wheeling was based on an
unlawful rate [improper inclusion of water stewardship rate], there was a
breach of the amended exchange agreement providing for future prices ‘equal
to the charge or charges set by Metropolitan’s Board of Directors pursuant to
applicable law and regulation and generally applicable to the conveyance of
water by Metropolitan on behalf of its member agencies.’ Since we [had]
concluded that Metropolitan’s system access rate was not improperly
included in the wheeling charges, there was no breach in that respect and
damages should not have been calculated on that erroneous premise.
[However,] [s]ince the water stewardship rate was unlawfully charged for the
conveyance of water, there was a breach of the agreement in that respect,”
and “[t]he Water Authority [was] entitled to recover damages limited to the
overcharges attributable to the unlawful inclusion of the water stewardship
rate.” (SDCWA v. MWD, supra, 12 Cal.App.5th at p. 1154.) Accordingly, we
reversed the judgment, vacated the peremptory writ of mandate, and
remanded the matter for the recalculation of damages, and other proceedings
consistent with the views expressed in our opinion. (Id. at p. 1166.)
8
D. Trial Court Proceeding After Remittitur
Following the remittitur, the trial court recalculated the Water
Authority’s contract damages, and again entered judgment in favor of the
Water Authority and issued a peremptory writ of mandate.
The judgment explicitly provided that “the Court of Appeal Opinion
and this Court’s July 25, 2018 Order are incorporated herein by reference.”
The judgment further provided, in pertinent part, as follows:
“1. Final judgment is ENTERED in favor of [Water Authority] and
against [Metropolitan] on the First Cause of Action in the 2010 and 2012
Actions, for writ of mandate, because Metropolitan’s inclusion of the Water
Stewardship Rate in the wheeling rate and the transportation rates charged
under the Exchange Agreement [4] is unlawful. See SDCWA v. MWD, 12
Cal.App.5th at [pp.] 1130, 1138-39, 1150-52, 1154-55. A peremptory writ of
mandate shall issue, under seal of this Court, commanding Metropolitan to
enact only legal wheeling and transportation rates in the future and to
exclude the costs of conservation programs and other demand management
programs, enacted in these cases as the Water Stewardship Rate, from
Metropolitan’s wheeling rate published in Section 4405 of Metropolitan’s
Administrative Code and from the transportation rates charged under the
Exchange Agreement. See id.; see also Code Civ. Proc. § 1095 (providing that,
when judgment in a writ of mandate action is ‘given for the applicant, the
applicant may recover the damages which the applicant has sustained . . .
and a peremptory [writ of] mandate must also be awarded without delay’).
4 “The ‘Exchange Agreement’ refers herein to the October 10, 2003
Amended and Restated Agreement Between the Metropolitan Water District
of Southern California and the San Diego County Water Authority for the
Exchange of Water. The Exchange Agreement is the source of the Water
Authority’s breach of contract claims.”
9
“2. Final judgment is ENTERED in favor of the Water Authority and
against Metropolitan on the Second Cause of Action in the 2010 and 2012
Cases, for declaratory relief, because Metropolitan’s inclusion of the Water
Stewardship Rate in the wheeling rate and the transportation rates charged
under the Exchange Agreement is unlawful. See SDCWA v. MWD, 12
Cal.App.5th at [pp.] 1130, 1138-39, 1150-52, 1154-55. In accordance with the
Court of Appeal’s holding that it is ‘improper’ to allocate to the wheeling rate
‘ “water stewardship” charges’ for the recovery of the ‘costs of conservation
programs and other water management programs,’ the Court hereby declares
that the inclusion of the Water Stewardship Rate in Metropolitan’s wheeling
rate and the transportation rates charged under the Exchange Agreement is
unlawful and invalid and, further, that Section 4405 of Metropolitan’s
Administrative Code, entitled ‘Wheeling Service,’ is unlawful and invalid
because it includes the Water Stewardship Rate in the rates charged for
wheeling service. [SDCWA v. MWD] at [pp.] 1130, 1138; see also id. at pp.
1138-39, 1150-52, 1154-1155.
“3. Final Judgment is ENTERED in favor of the Water Authority
and against Metropolitan, and all other persons, on the Third Cause of Action
in the 2010 and 2012 Actions, for determination of invalidity, because
Metropolitan’s inclusion of the Water Stewardship Rate in the wheeling rate
and the transportation rates charged under the Exchange Agreement is
unlawful. See SDCWA v. MWD, 12 Cal.App.5th at [pp.] 1130, 1138-39, 1150-
52, 1154-55. In accordance with the Court of Appeal’s holding that it is
‘improper’ to allocate to the wheeling rate ‘ “water stewardship” charges’ for
the recovery of the ‘costs of conservation programs and other water
management programs,’ the Court hereby determines that the inclusion of
the Water Stewardship Rate in Metropolitan’s wheeling rate and the
10
transportation rates charged under the Exchange agreement is unlawful and
invalid and, further, that Section 4405 of Metropolitan’s Administrative
Code, entitled ‘Wheeling Service,’ is unlawful and invalid because it includes
the Water Stewardship Rate in the rates charged for wheeling service.
[SDCWA v. MWD] at [pp.] 1130, 1138; see also id. at [pp.] 1138-39, 1150-
1152, 1154-55. This judgment, ‘if no appeal is taken, or if taken and the
judgment is affirmed, shall . . . be forever binding and conclusive, as to all
matters [ ]herein adjudicated or which at that time could have adjudicated,
against [Metropolitan] and against all other persons, and the judgment shall
permanently enjoin the institution by any person of any action or proceeding
raising any issue as to which the judgment is binding and conclusive.’ Code
Civ. Proc. § 870(a). [¶] . . . [¶]
“8. This Court will retain continuing jurisdiction over the 2010 and
2012 Actions.
“9. This is the final judgment in the 2010 Action and 2012 Action.”
The trial court’s peremptory writ of mandate provided as follows
(bolded language in original):
“Final judgment having been entered on the first cause of action in the
2010 and 2012 Actions, for writ of mandate, METROPOLITAN [IS]
HEREBY COMMANDED to enact only legal wheeling and transportation
rates in the future, and specifically, not to do the things that Division Three
of the First Appellate Court of Appeal held were unlawful in its Opinion
dated June 21, 2017. San Diego Cty. Water Auth. v. Metropolitan Water Dist.
of S. Cal., 12 Cal. App. 5th 1124, 1166 (2017), as modified on denial of reh’g
(July 18, 2017), review denied (Sep. 27, 2017). The Opinion is incorporated
here by reference.
11
“METROPOLITAN IS FURTHER HEREBY SPECIFICALLY
COMMANDED to henceforth exclude the costs of conservation programs
and other demand management programs, enacted in the above-named cases
as the Water Stewardship Rate, from Metropolitan’s wheeling rate published
in Section 4405 of Metropolitan’s Administrative Code and from the
transportation rates charged under the October 10, 2003 Exchange
Agreement between Metropolitan and the San Diego Water Authority.”
Metropolitan’s timely appealed.
DISCUSSION
I. Challenges to Judgment
Metropolitan raises various arguments seeking modification of the
judgment, none of which require the requested relief.
Metropolitan initially and inaccurately contends the judgment
materially varies from this court’s remittitur. “Our remittitur directions are
contained in the dispositional language of our previous opinion.” (Ayyad v.
Sprint Spectrum, L.P. (2012) 210 Cal.App.4th 851, 859 (Ayyad).) While we
are not bound by the trial court’s interpretation of those directions, “[w]e look
to the wording of our directions to determine whether the trial court’s
[judgment] comports with them.” (Ibid.) “When, as in this case,” we remand
for further proceedings, our directions “must be read in conjunction with the
opinion as a whole.” (Ibid.)
“Whether the trial court correctly interpreted our opinion is an issue of
law subject to de novo review.” (Ayyad, supra, 210 Cal.App.4th at p. 859.)
Here, the judgment’s adjudication of the three causes of action for writ relief,
declaratory relief, and a determination of invalidity (Code Civ. Proc., §§ 860
et. seq.) (first, second, and third causes of action) are consistent with our
prior opinion. Metropolitan asserts, however, that the provisions should be
12
modified to include language indicating that the granted relief only applies to
Metropolitan’s water stewardship rate in effect from January 1, 2011 through
December 31, 2014 so that the judgment is not misconstrued as an
adjudication that water rates set after 2014 are unlawful if they include a
water stewardship rate. We disagree.
The Water Authority’s challenge was to Metropolitan’s practice of
allocating certain subcomponents or categories of costs (service access rate
and water stewardship rate) recoverable as transportation costs in its
wheeling rate and the transportation rates charged under the exchange
agreement. As reflected in the judgment, we held invalid Metropolitan’s
practice of allocating a water stewardship rate (funding for water
conservation programs) as a cost subcomponent (recoverable
as a transportation cost in its wheeling rate and the transportation rates
charged under the exchange agreement). (SDCWA v. MWD, supra, 12
Cal.App.5th at pp. 1139, 1151.) Our determination concerned a particular
category of costs (“water stewardship rate”) which did not vary from year to
year. (Ibid.) Thus, there was no need nor did we intend to limit our
determination to any particular rate year.
In seeking a modification to include a time referent related to a
particular rate year, Metropolitan mentions no circumstance under which in
any future year it would be able to establish that the water stewardship rate
(defined as “ ‘a volumetric charge upon all water moved through the system
that provides a dedicated source of funding for conservation and local
resources development’ ” (SDCWA v. MWD, supra, 12 Cal.App.5th at p.
1139)) could be properly included as a cost subcomponent recoverable as a
transportation cost in the wheeling rate or transportation rates charged
under the exchange agreement. Accordingly, we see no reason to direct the
13
modification as argued by Metropolitan. That Metropolitan apparently
believes that in some future rate year it can recover a water stewardship rate
as a cost subcomponent of its transportation costs in its wheeling rate or the
transportation rates charged under the exchange agreement, thereby
contravening our prior opinion, supports the trial court’s continuing
jurisdiction to assure compliance with its judgment. (See San Luis Coastal
Unified School Dist. v. City of Morro Bay (2000) 81 Cal.App.4th 1044, 1046,
1055 (San Luis Coastal Unified School Dist.) [on remand in a mandamus
proceeding to compel the city to comply with the “ ‘Wheeling Statutes,’ ” the
appellate court directed the trial court to order the city to determine, among
other criteria, fair compensation for use of its water conveyance facilities as
required under Wat. Code § 1812, and further found it would be prudent if
the trial court retained continuing jurisdiction to assure compliance with the
trial court’s order].)
The judgment also contains a declaration describing the basis on which
Metropolitan’s water rates were declared to be invalid – the inclusion of the
water stewardship rate (costs for water conservation programs, also referred
to as “ ‘demand-management programs’ ” by Metropolitan) as a cost
subcomponent recoverable as a transportation cost in its wheeling rate and
transportation rates charged under the exchange agreement. (SDCWA v.
MWD, supra, 12 Cal.App.5th at p. 1150.) Metropolitan complains, however,
that the judgment should be modified to provide for an additional declaration
that “Metropolitan’s allocation of its [State Water Project] transportation
costs to its transportation rates and wheeling rate is not ‘contrary to law’ and
does not ‘violate constitutional, statutory, and common law, as well as
Metropolitan’s own Administrative Code and Board policy directives.’ ”
Again, we disagree.
14
The trial court properly adjudged that the Water Authority was
entitled to relief on its second cause of action for declaratory relief and set
forth the theory that supported the relief – improper inclusion of the water
stewardship rate. Even if the court erred in failing to mention that the
Water Authority had not been successful on another theory (Metropolitan’s
water rates were invalid due to its inclusion of the State Water Project
transportation costs), no relief is required to cure this purported error as our
prior opinion is sufficiently certain and explicit as to what Metropolitan can
or cannot include as cost subcomponents of its transportation costs in its
wheeling rate and the transportation rates charged under the exchange
agreement. (See Savient Pharmaceuticals, Inc. v. Department of Health
Services (2007) 146 Cal.App.4th 1457, 1464 [appellant’s complaint that the
trial court failed to declare the rights of the parties, of itself, provides no
basis for reversal as “an appellate opinion memorializes the rights of the
parties”]; Teresi v. State of California (1986) 180 Cal.App.3d 239, 245, fn. 4
[appellate court noted that “[t]he object of the declaratory relief action is
served by our opinion that plaintiff cannot recover on the legal theory he
asserts”]; see also Gelfand v. O’Haver (1948) 33 Cal.2d 218, 222 [“resort may
be had to the findings of fact and conclusions of law” in a court’s opinion “to
clarify any uncertainty or ambiguity in a judgment”].) The cases cited by
Metropolitan do not require a different outcome.
In sum, we conclude there is no need to modify the judgment in its
current form. The judgment did not exceed our remittitur and in future
proceedings the parties and courts may consider our prior opinion’s plain
rulings for the purposes of understanding and interpreting the judgment. 5
5 In its reply brief, Metropolitan argues, for the first time, that the
judgment should be modified because it has already suffered prejudice as the
trial court relied on its failure to grant Metropolitan declaratory relief in its
15
II. Challenges to Peremptory Writ of Mandate
Metropolitan also raises various arguments challenging the issuance of
the peremptory writ of mandate, none of which hold water.
We initially reject Metropolitan’s argument that the peremptory writ of
mandate must be vacated because its issuance exceeded our remittitur. In
support of its argument, Metropolitan asks us to consider that in our prior
opinion we did not find it had an existing legal duty to perform any act,
ministerial or otherwise, for the Water Authority’s benefit. It also avers that
our disposition in the prior opinion did not direct the trial court to issue a
writ commanding Metropolitan to perform any act.
However, in resolving the prior opinion, we had no reason to address
the trial court’s authority to grant writ relief to the Water Authority.
Instead, we dealt only with the substantive arguments of the parties, leaving
to the trial court on remand to reissue a judgment and peremptory writ of
mandate consistent with our rulings. “The general direction upon the
reversal of the judgment was, that the [trial court] should proceed to dispose
of the case remitted, in pursuance of the principles of the opinion.” (Raun v.
Reynolds (1860) 15 Cal. 459, 468.) Because we did not preclude or otherwise
limit the nature of the judgment and peremptory writ of mandate that could
be reissued following the further proceedings ordered by this court, the
remittitur did not prevent the trial court from “taking such a course of
judgment as one reason for the award of costs to the Water Authority as the
prevailing party. However, by raising this specific issue of prejudice in its
reply brief for the first time, the Water Authority has been deprived of an
opportunity to address the matter on this appeal. Because the trial court’s
February 10, 2021 cost order is the subject of a separate appeal in case No.
A162168, we do not now address Metropolitan’s argument and our decision
should not be read as expressing any opinion regarding the effect of the
judgment’s provisions vis a vis the award of costs to Water Authority as the
prevailing party.
16
proceedings as would give full effect to the principles of the opinion of this
[c]ourt.” (Ibid.; italics in original.; see Eldridge v. Burns (1982) 136
Cal.App.3d 907, 917 [“language remanding for ‘further proceedings consistent
with the opinion’ does not in itself clearly and unambiguously determine the
effect of an opinion on remand”].)
There is also no merit to Metropolitan’s substantive argument that the
trial court should not have issued a peremptory writ of mandate because
Metropolitan had no clear, present, and ministerial duty to act for the benefit
of the Water Authority. “An action in ordinary mandamus is proper where,
as here, the claim is that an agency failed to act as required by law.”
(California Assn. for Health Services at Home v. State Dept. of Health Services
(2007) 148 Cal.App.4th 696, 705; see People ex rel. Younger v. County of El
Dorado (1971) 5 Cal.3d 480, 491 [a writ will issue where there is “[a] clear,
present and usually ministerial duty upon the part of the respondent,” and “a
clear, present and beneficial right in the petitioner to the performance of that
duty”].)
In its 2010 and 2012 actions, the Water Authority’s requests for
mandamus were predicated on a claim that Metropolitan failed to act as
required by law in determining “fair compensation” for a wheeler’s use of an
owner’s water conveyance system for transporting water under both the
Wheeling Statutes and the parties’ exchange agreement under which
Metropolitan had a duty to calculate water rates pursuant to applicable law
and regulation. “Our state Constitution provides that: ‘The right to collect
rates or compensation for the use of water supplied to any county, city and
county, or town, or the inhabitants thereof, is a franchise, and cannot be
exercised except by authority of and in the manner prescribed by law.’ (Cal.
Const., art. X, § 6.) [¶] The wheeling statutes provide a basis for the Water
17
Authority to use Metropolitan’s conveyance facilities upon the payment of fair
compensation. (Wat. Code, § 1810.)” (SDCWA v. MWD, supra, 12 Cal.App.5th
at p. 1166 [Siggins, J., concurring].) Water Code section 1812 specifically
requires that a local public agency owning the water conveyance facility, in
this case Metropolitan, “shall in a timely manner determine . . . [t]he terms
and conditions, including . . . fair compensation” for the use of its facilities
(id, subd. (b)). The wheeling statutes also “make clear that ‘any
determination made under this article’ can be the subject of a judicial
challenge in which the court shall consider all relevant evidence, and the
court shall give due consideration to the purposes and policies of this article.’
(Wat. Code, § 1813.)” (SDCWA v. MWD, supra, at pp. 1166-1167 [Siggins, J.,
concurring].)
Thus, the writ properly compels Metropolitan to perform its clear and
present legal obligation, pursuant to Water Code sections 1810 and 1812,
requiring the owner of a water conveyance facility to timely determine fair
compensation for use of its water conveyance services for the benefit of the
Water Authority, which is an entity entitled to use the facilities upon the
payment of fair compensation. By ordering Metropolitan to enact lawful
wheeling and transportation rates in the future consistent with our prior
opinion, the writ does no more than compel Metropolitan “to exercise [its]
discretion under a proper interpretation of the applicable law.” (California
Assn. for Health Services at Home v. State Dept. of Health Care Services
(2012) 204 Cal.App.4th 676, 683 (California Assn. for Health Services at
Home).)
Metropolitan also asserts that the second paragraph of the writ should
be vacated because the command that it “henceforth” exclude the water
stewardship rate from its “wheeling rate published in Section 4405 of [its]
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Administrative Code” is “useless, unenforceable, unavailing, or of no practical
benefit” to the Water Authority. In support of this argument, Metropolitan
notes that after the August 13, 2020, issuance of the writ, Metropolitan’s
Board of Directors repealed section 4405 of its Administrative Code and
Metropolitan no longer publishes or charges a pre-set wheeling rate,6 facts of
which we have taken judicial notice. (See fn. 1, ante.) The short answer to
Metropolitan’s argument is that “ ‘[i]t is settled that the voluntary
6 Metropolitan’s Administrative Code former section 4405 provided, in
pertinent part: “(b) The rates for wheeling service shall include the System
Access Rate, Water Stewardship Rate and, for treated water, the Treatment
Surcharge, as set forth in Section 4401. . . .”
At the August 18, 2020, Board meeting, the Board received the report
of its Finance and Insurance Committee explaining the reason for
recommending the repeal of Metropolitan’s Administrative Code section 4405
and the effect of the repeal: “Staff recommends that the Board repeal
Metropolitan’s pre-set rate for wheeling service (wheeling rate), which applies
only to wheeling to member agencies for up to one year, and rescind the
supporting Resolution 8520 [(Fixing and Adopting Wheeling Rates)]. The
price for wheeling to member agencies for more than one year, and wheeling
to third parties, is determined on a case-by-case basis and is set by contract.
After the recommended action, the price for wheeling to member agencies for
up to one year would also be established by contract on a case-by-case basis.
[¶] All wheeling requests by member agencies and third parties would
continue to be considered for approval in accordance with the Wheeling
Statute, Water Code Section 1810, et seq. The recommended action would
only discontinue a pre-set price for certain wheeling transactions. [¶] Staff
makes this recommendation because one component of the wheeling rate –
the Water Stewardship Rate – is suspended effective 2021 and 2022, and
therefore the current wheeling rate cannot be applied. As Metropolitan
intends to replace the Water Stewardship Rate, the wheeling rate cannot be
applied in the future. The wheeling rate’s continued inclusion in the
Administrative Code is no longer necessary. . . . Two agreements exist with
San Diego County Water Authority (SDCWA) that incorporate the Section
4405 wheeling rate as the contractual price term. However, now that the
Water Stewardship Rate will no longer be in place, rendering the Section
4405 wheeling rate inoperative, the price term for those two agreements
must be renegotiated.”
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discontinuance of alleged illegal practices does not remove the pending
charges of illegality from the sphere of judicial power or relieve the court of
the duty of determining the validity of such charges where by the mere
volition of a party the challenged practices may be resumed.’ ” (Marin
County Bd. of Realtors, Inc. v. Palsson (1976) 16 Cal.3d 920, 928-929 [on
review of an order declaring valid a county board of realtors’ bylaw requiring
all associate members to be primarily engaged in the practice of real estate,
appellate court found appeal was still justifiable because although the rule
had been discontinued there was no assurance the board would not reenact it
in the future].) Here, there is nothing in the August 18, 2020 Board
proceedings that would preclude Metropolitan from a future re-enactment of
former section 4405 of its Administrative Code.
Metropolitan alternatively argues that, if the issuance of the writ is
upheld, we should nonetheless direct the trial court to modify it by removing
the language in paragraph one commanding Metropolitan “to enact only legal
wheeling and transportation rates in the future, and, specifically,” so as to
limit the writ to the issues litigated in these cases. According to
Metropolitan, the quoted writ language “is impermissibly overbroad and
vague because it is not tethered to any of the legal infirmities the courts
considered in these cases and because it fails to prescribe a standard of
conduct sufficiently specific and free from subjectivity to forestall future
differences of opinion” it may subject Metropolitan to contempt proceedings.
We disagree.
The writ does not include a general “obey the law” provision but is
specifically focused on Metropolitan’s statutory obligation to “enact legal
wheeling and transportation rates” and “not to do the things that [this court]
held were unlawful” in our prior opinion, which is specifically incorporated in
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the writ. (See San Luis Coastal Unified School Dist., supra, 81 Cal.App.4th
at pp. 1044, 1046, 1051 [on remand in a mandamus proceeding to compel the
city to comply with the “ ‘Wheeling Statutes’ ” (Wat. Code §§ 1810 et. seq.),
trial court was directed to enter an order compelling the city to make the
statutorily required Wat. Code § 1812 determinations, including fair
compensation for the use of the facilities]; see also California Assn. for Health
Services at Home, supra, 204 Cal.App.4th at pp. 689-690 [appellate court
directed trial court “to issue a supplemental writ of mandate compelling the
Department to conduct a future rate review . . . in accordance with the state
plan, section 30(A), the April 24, 2008, writ of mandate, and the provisions of
this opinion”]; Conlan v. Bonta´ (2002) 102 Cal.App.4th 745, 764 [appellate
court directed trial court to issue a writ of mandate “directing the
Department to adopt and implement procedures consistent with this
opinion”]; Graham v. State Bd. of Control (1995) 33 Cal.App.4th 253, 261
[appellate court directed trial court “to issue a writ of mandate ordering the
Board to take further proceedings consistent with this opinion”].)
In sum, we conclude there is no need to modify the peremptory writ of
mandate in its current form. The issuance of the peremptory writ of mandate
did not exceed our remittitur and if Metropolitan considers the writ in “light
of the findings of fact and conclusions of law” in our prior opinion, “and ‘the
purpose and object of the litigation which terminated in the [judgment],’ . . .
[it] will be able to comply with it.” (City of Vernon v. Superior Court (1952) 38
Cal.2d 509, 514).
DISPOSITION
The judgment and peremptory writ of mandate are affirmed. Plaintiff
and respondent San Diego County Water Authority is awarded costs on
appeal.
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_________________________
Petrou, J.
WE CONCUR:
_________________________
Fujisaki, Acting P.J.
_________________________
Chou, J.*
*
Judge of the Superior Court of San Mateo County, assigned by the
Chief Justice pursuant to article VI, section 6 of the California Constitution.
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