Stanford Law School - Robert Crown Law Library

Filed 3/7/05

IN THE SUPREME COURT OF CALIFORNIA

JANET CAMPBELL,
Plaintiff and Appellant,
S113275
v.
) Ct.App.
1/1
A097560
THE REGENTS OF THE UNIVERSITY )
OF CALIFORNIA,
San
Francisco
Defendant and Respondent.
Super. Ct. No. 312736

In this action, we address whether an employee of the Regents of the
University of California (the Regents) must exhaust university internal
administrative remedies before filing suit in superior court for retaliatory
termination under either Government Code section 12653, subdivision (c), or
Labor Code section 1102.5, sometimes called the “whistleblower” statutes. We
conclude the exhaustion rule requires university employees to exhaust university
administrative remedies before proceeding to suit. We therefore affirm the
judgment of the Court of Appeal.
I. FACTUAL BACKGROUND
Appellant Janet Campbell worked for the Regents as a senior architect in
the Architectural Design and Engineering Unit of the Facilities Management
Department (FMD) at the University of California, San Francisco (UCSF). The
Regents, a state government entity, administer the University of California,
including UCSF. (See California Medical Assn. v. Regents of University of
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California (2000) 79 Cal.App.4th 542, 544, fn. 1.) Campbell’s job duties included
reviewing architectural plans and specifications for all campus construction
projects costing less than $250,000, to ensure that the projects complied with
competitive bidding laws. Campbell claims that in 1991, her supervisor at the
FMD, acting on the Regents’ behalf, directed her to prepare or help prepare bid
documents that limited competition by using restrictive specifications. Campbell
protested to the Regents on several occasions that using these documents to limit
the bidding violated state competitive bidding laws. (See Pub. Contract Code, §
3400 [prohibiting state agencies from limiting contract bidding “to any one
specific concern”].) She later reported the alleged violations to the Federal Bureau
of Investigation (FBI).
In 1997, the FBI questioned UCSF officials about the alleged violations.
The Regents then changed Campbell’s job duties, assigning her to what she
perceived to be menial, less challenging projects. Campbell soon went on
extended disability leave. Shortly after she returned to work, in January 1999, she
was discharged. The Regents blamed her discharge on downsizing. Campbell
claimed that less senior and less qualified coworkers were retained, however.
On March 4, 1999, Campbell, through her attorney, filed an internal
complaint against UCSF and her supervisors. The complaint, filed under the
grievance procedures set forth in UCSF’s Personnel Policies for Staff Members
(PPSM), alleged, among other things, that Campbell was discharged in retaliation
for being a whistle-blower.
On April 23, 1999, a UCSF staff member responded to the complaint in a
letter to Campbell’s attorney (the letter). The letter stated that the PPSM’s
complaint resolution process excluded allegations of retaliation for
whistleblowing. The letter observed that such complaints were properly filed
under UCSF’s Policy and Procedures for Reporting Improper Governmental
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Activities and Protection Against Retaliation for Reporting Improper Activities
(Policy and Procedures). The letter also stated, “Alleged violations of state and
federal laws will be excluded from the [PPSM’s] complaint resolution process.”
A copy of the applicable Policy and Procedures was enclosed with the letter.
Campbell did not refile her complaint under the Policy and Procedures, as the
letter directed.
Section IX (A) of the Policy and Procedures sent to Campbell states that
“Any UC employee . . . may file a written complaint against a University
employee alleging threatened or actual interference or retaliation resulting from
the reporting of improper activities. . . . Retaliation is defined as the use of official
authority or influence by a UC employee for the purpose of interfering with the
right of a person to file a report as described in Section V above, or the right to file
such a report with the University Auditor or with the Auditor General of the State
of California, or with other public officials designated to receive reports of
improper activity. Use of ‘official authority to influence’ includes promising to
confer, or conferring, any benefit; effecting or threatening to effect any reprisal; or
taking, or directing others to take, or recommending, processing or approving any
personnel action, including but not limited to appointment, promotion, transfer
assignment, performance evaluation, suspension, or other disciplinary action.”
The balance of section IX (A) contains provisions governing the complaint’s
contents. Immediately following that section is a paragraph titled, “Use of
Existing Mechanisms.” This paragraph states in pertinent part: “A complaint of
retaliation/interference must be filed under existing University grievance or
complaint resolution procedures . . . if acceptable under those procedures. If the
complaint is not within the scope of any complaint resolution procedure available
to the complainant under the appeals mechanism described in the previous
paragraph, or if the complainant is an applicant for employment or does not have a
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complaint resolution procedure available for some other reason, the complaint
may be filed under this policy.”
The letter therefore informed Campbell that the typical personnel manual
grievance procedure did not apply to her grievance because she alleged state law
violations. It also told her that she was required to file her grievance under the
Policy and Procedures.
On June 7, 2000, Campbell filed a whistleblower complaint against the
Regents in San Francisco Superior Court, seeking damages for retaliatory
termination under Government Code section 12653 and Labor Code section
1102.5. She alleged that she had either exhausted all administrative remedies or
was not required to exhaust them. The Regents demurred to the complaint on the
ground that Campbell’s refusal to file a grievance under the Policy and
Procedures, as the letter directed, amounted to a failure to exhaust administrative
remedies. The trial court sustained the demurrer. It granted Campbell leave to
amend her complaint to allege either that she had fulfilled the exhaustion
requirement, or that an exception to the requirement excused her from its
application.
Campbell’s first amended complaint alleged that she had filed an internal
grievance complaint under the PPSM; that Government Code section 12653 and
Labor Code section 1102.5 did not require her to exhaust UCSF’s administrative
remedies; and that the letter informed her that the PPSM excluded her
whistleblowing allegations. She also claimed that the letter did not advise her that
if she failed initially to pursue the proper administrative remedies for the
whistleblowing claim, she would be precluded from taking legal action. The
Regents again demurred to the amended complaint on the ground that Campbell
failed to exhaust her administrative remedies.
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The trial court sustained the Regents’ demurrer to the first amended
complaint. It gave Campbell leave to amend in order to plead that the futility
doctrine excused her failure to exhaust, and that the Regents did not notify her of
the relevant grievance procedures.
Campbell filed a second amended complaint, alleging that the principles of
estoppel excused her from complying with exhaustion requirements because the
Regents had failed to inform her of “the necessity to file a grievance under the
whistle-blowing policy.” The Regents demurred to that complaint on the grounds
that Campbell failed to allege that exhaustion would have been futile, and that she
was properly advised of the applicable grievance procedures. The trial court
sustained the Regents’ demurrer to the second amended complaint without leave
to amend and entered judgment in the Regents’ favor.
Campbell appealed. The Court of Appeal affirmed the trial court’s
dismissal for failure to exhaust administrative remedies. We granted Campbell’s
petition for review.
II. DISCUSSION
A. Procedural Background
When reviewing a judgment dismissing a complaint after a successful
demurrer, we assume the complaint’s properly pleaded or implied factual
allegations are true, and we give the complaint a reasonable interpretation, reading
it in context. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081
(Schifando).) We also consider judicially noticeable matters. (Ibid.) If we see a
reasonable possibility that the plaintiff could cure the defect by amendment, then
we conclude that the trial court abused its discretion in denying leave to amend.
(Ibid.) If we determine otherwise, then we conclude it did not. (Ibid.) The
plaintiff has the burden of proving that an amendment would cure the defect.
(Ibid.)
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B. The Regents’ Constitutional Authority
Because the present action involves the rights of a UCSF employee, we
should note the Regents’ constitutional status. The California Constitution
establishes the Regents as a “public trust . . . with full powers of organization and
government.” (Cal. Const., art. IX, § 9, subd. (a).) We have observed that
“Article IX, section 9, grants the [R]egents broad powers to organize and govern
the university and limits the Legislature’s power to regulate either the university or
the [R]egents. This contrasts with the comprehensive power of regulation the
Legislature possesses over other state agencies.” (San Francisco Labor Council v.
Regents of University of California (1980) 26 Cal.3d 785, 788 (Labor Council)
[the Regents are not bound by Education Code section 92611 when setting wage
levels].) This grant of constitutional power to the University includes the grant of
quasi-judicial powers, a view that is generally accepted in our jurisprudence.
(Ishimatsu v. Regents of University of California (1968) 266 Cal.App.2d 854, 864;
see also Apte v. Regents of University of California (1988) 198 Cal.App.3d 1084,
1091.)
The Regents may also exercise quasi-legislative powers, subject to
legislative regulation. Indeed, “[p]olicies established by the Regents as matters of
internal regulation may enjoy a status equivalent to that of state statutes.”
(Regents of University of California v. City of Santa Monica (1978) 77 Cal.App.3d
130, 135, citing Hamilton v. Regents (1934) 293 U.S. 245.) The authority granted
the Regents includes “full powers of organization and government, subject only to
such legislative control as may be necessary to insure compliance with the terms
of the endowment of the University and the security of its funds.” (Goldberg v.
Regents of University of California (1967) 248 Cal.App.2d 867, 874.) Thus,
“[t]he Regents have been characterized as ‘a branch of the state itself’ [citation] or
‘a statewide administrative agency’ [citation]” (Regents of University of California
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v. City of Santa Monica, supra, 77 Cal.App.3d at p. 135), and “[i]t is apparent that
the Regents as a constitutionally created arm of the state have virtual autonomy in
self-governance” (ibid.). Therefore, “[t]he Regents have the general rule-making
or policy-making power in regard to the University [citation], and are (with
exceptions not material here) fully empowered with respect to the organization
and government of the University.” (Goldberg, supra, 248 Cal.App.2d at p. 874.)
The Regents may create a policy for handling whistleblower claims under their
power to organize and govern the University. Such a policy is treated as a statute
in order to determine whether the exhaustion doctrine applies.
The Regents are not entirely autonomous. The Legislature may regulate the
Regents’ actions in three areas: (1) the Regents cannot compel appropriations for
university salaries, because the Legislature is vested with the power of
appropriation; (2) statutes that express the state’s general police power, such as
workers’ compensation laws, apply to the Regents; and, (3) when legislation
regulating public agency activity addresses matters of statewide concern not
involving internal university affairs, the legislation may be made applicable to the
Regents. (Labor Council, supra, 26 Cal.3d at p. 789.)
C. The Rule of Exhaustion of Administrative Remedies
As the Court of Appeal observed, the rule of exhaustion of administrative
remedies is well established in California jurisprudence, and should apply to
Campbell’s action. “In brief, the rule is that where an administrative remedy is
provided by statute, relief must be sought from the administrative body and this
remedy exhausted before the courts will act.” (Abelleira v. District Court of
Appeal (1941) 17 Cal.2d 280, 292 (Abelleira).) The rule “is not a matter of
judicial discretion, but is a fundamental rule of procedure . . . binding upon all
courts.” (Id. at p. 293.) We have emphasized that, “Exhaustion of administrative
remedies is ‘a jurisdictional prerequisite to resort to the courts.’ [Citation].”
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(Johnson v. City of Loma Linda (2000) 24 Cal.4th 61, 70.) “The gist of Westlake,
Rojo, and Moreno [1] is a respect for internal grievance procedures and the
exhaustion requirement where the Legislature has not specifically mandated its
own administrative review process . . . .” (Schifando, supra, 31 Cal.4th at p.
1092.) The exhaustion rule extends to employees seeking judicial review of an
employer’s administrative findings. (Johnson v. City of Loma Linda, supra, 24
Cal.4th at p. 70.)
The rule has important benefits: (1) it serves the salutary function of
mitigating damages; (2) it recognizes the quasi-judicial tribunal’s expertise; and
(3) it promotes judicial economy by unearthing the relevant evidence and by
providing a record should there be a review of the case. (Westlake, supra, 17
Cal.3d at p. 476.)
As the Court of Appeal noted, the administrative remedies exhaustion rule
has several exceptions, including, but not limited to, those Campbell raises: (1)
when the administrative agency cannot provide an adequate remedy, and (2) when
the subject of controversy lies outside the agency’s jurisdiction. (Edgren v.
Regents of University of California (1984) 158 Cal.App.3d 515, 520-521
(Edgren).) These exceptions remain flexible and are by no means limited to those
discussed here. (Ogo Associates v. City of Torrance (1974) 37 Cal.App.3d 830,
834.)

1
Westlake Community Hosp. v. Superior Court (1976) 17 Cal.3d 465
(Westlake); Rojo v. Kliger (1990) 52 Cal.3d 65; Moreno v. Cairns (1942) 20
Cal.2d 531.
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D. Campbell’s Contentions

1. General principles
Campbell initially asserts that the exhaustion rule does not apply here
because the Regents provide inadequate administrative remedies and because her
remedies lie outside the Regents’ jurisdiction. She also claims that two anti-
retaliation statutes the Legislature has enacted have superseded the exhaustion
rule. As to the latter assertion, Campbell points to no specific provision in either
statute. Rather, she asks this court to infer an exemption from the Legislature’s
statutory language allegedly authorizing direct access to the courts, in this and
arguably related contexts. We address her claims separately.2
2. Alleged inadequate remedy
Campbell initially asserts that she should have direct access to the courts
because she seeks not only reinstatement and back wages, but also money
damages. Campbell does not as a general matter dispute the adequacy of the
Regent’s remedial procedures. Rather, she claims the exhaustion rule should not
apply to her because, “The administrative remedy will always be inadequate
compared to the damages remedy made expressly available to an aggrieved
employee by the Legislature under either Government Code section 12653(c) or
Labor Code section 1102.5.” Not so. The Regents’ Policy and Procedures allow

2
The Regents initially assert that Campbell waived her contention that her
statutory retaliation claim is not subject to the exhaustion requirement because,
although she raised the contention in her first amended complaint, she did not
appeal the trial court’s ruling sustaining the Regents’ demurrer to that complaint
with leave to amend. Instead, as discussed above, she filed a second amended
complaint alleging she was excused from the exhaustion requirement, arguably a
separate contention. The Court of Appeal did not address the waiver question, and
we decline to do so here because Campbell’s failure to exhaust administrative
remedies presents a jurisdictional question related to her statutory claims, and we
may review it at any point in the proceedings. (See Inland Empire Health Plan v.
Superior Court (2003) 108 Cal.App.4th 588, 592.)
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the Regents to provide the complainant with “any appropriate relief” and to
impose any sanctions on the offending employees “in accordance with existing
disciplinary policies or contract provisions.”
In addition, even though Campbell’s complaint seeks money damages in
addition to reinstatement, our cases hold that the “policy considerations which
support the imposition of a general exhaustion requirement remain
compelling . . . .” (Westlake, supra, 17 Cal.3d at p. 476.) The logic holds even
when no internal damage remedy is available, or a plaintiff seeks only money
damages, so that resort to the courts is inevitable. As Edgren explains, courts have
found the rule inapplicable only when the agency lacks authority to hear the
complaint, not when the administrative procedures arguably limit the remedy the
agency may award. (Edgren, supra, 158 Cal.App.3d at p. 521; see also Glendale
City Employees’ Assn., Inc. v. City of Glendale (1975) 15 Cal.3d 328, 342-343
[exhaustion rule does not apply when resolution of controversy falls outside scope
of grievance procedures].) We believe that the “administrative proceeding will
still promote judicial efficiency by unearthing the relevant evidence and by
providing a record which the court may review.” (Westlake, supra, 17 Cal.3d at p.
476.)
We also disagree that Campbell is exempt because the Regents lack
jurisdiction. Tiernan v. Trustees of Cal. State University & Colleges (1982) 33
Cal.3d 211 provides an example of the exception an agency’s lack of jurisdiction
creates. In Tiernan, a temporary academic employee’s term was not renewed. In
her grievance she alleged that the law required her employer to adopt regulations
governing notice of nonreappointment. The court found that the plaintiff’s claim
fell within the jurisdictional exception because it required the grievance committee
to determine whether the university had to adopt regulations or interpret
established regulations. In such a case, the grievance committee could deny a
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claim on purely procedural grounds. (Id. at p. 218.) By contrast, Campbell’s
action does not require the Regents’ internal review board to decide the legality of
current employer policies before considering the legality of the employer’s
actions.
Abelleira, supra, 17 Cal.2d 280, is also instructive. In Abelleira, a group of
unemployed San Francisco dock workers petitioned for a writ of prohibition to
restrain the Court of Appeal from enforcing a writ of mandate that it had issued
against the California Employment Commission and in favor of their employer.
The Court of Appeal determined that the commission acted beyond its statutory
powers in requiring the workers to first satisfy the commission’s administrative
procedures. Thus, the commission had no jurisdiction to determine whether the
dock workers were entitled to unemployment benefits. (Id. at p. 285.) In
reversing the Court of Appeal judgment, we held that the commission did have
jurisdiction to make this determination, and that the dock workers correctly sought
administrative review before filing their claim for benefits. (Id. at p. 291.) In so
doing, we observed that the Unemployment Insurance Act provided for an
administrative procedure. (Ibid.) The claim therefore fell under the exhaustion of
administrative remedies rule. (Id. at p. 292.)
The present action involves a policy the Regents established to handle
complaints of retaliatory dismissal for whistleblowing in an orderly manner.
Because we may treat such a policy as equivalent to a statute in this action, and
because that policy required Campbell to resort initially to internal grievance
practices and procedures, Campbell had an administrative remedy within the
meaning of Abelleira and its progeny.

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3. Construction of Government Code section 12653 subdivision (c), and

Labor Code section 1102.5
Campbell next contends that neither Government Code section 12653,
subdivision (c), nor Labor Code section 1102.5 requires her to exhaust her
administrative remedies, and that the Legislature therefore intended to abrogate
the exhaustion requirement for actions such as hers. Because Campbell’s
argument requires us to construe two statutes, “we must ‘ “ascertain the intent of
the lawmakers so as to effectuate the purpose of [each] law.’ ” [Citations.] We
begin by examining the language of [each] statute [separately], giving the words
their ordinary meaning. [Citation.] ‘The words, however, must be read in context,
considering the nature and purpose of the statutory enactment[s].’ [Citation.] In
this regard, sentences are not to be viewed in isolation but in light of the statutory
scheme. [Citation.]” (Torres v. Automobile Club of So. California (1997) 15
Cal.4th 771, 777 (Torres).)
a. Government Code section 12653, subdivision (c)
Government Code section 126533 is part of the False Claims Act (Gov.
Code, §§ 12650-12656) (the Act). The Act protects public funds by authorizing
employee informants who discover fraudulent claims made against state and local
governmental entities to file qui tam suits on behalf of those entities. (E.g., City of
Hawthorne ex rel. Wohlner v. H&C Disposal Co. (2003) 109 Cal.App.4th 1668,
1672, fn. 2 [defining qui tam as part of a Latin phrase meaning one “who brings
the action for the king as well as for himself”].) Qui tam plaintiffs sue as
informers under a statute on behalf of themselves and the State of California. Qui
tam plaintiffs may recover damages and penalties on behalf of public entities for
themselves and the entities. (Id. at p. 1677)

3
Subsequent statutory references are to the Government Code unless
otherwise specified.
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Section 12653 addresses employer interference with employee disclosures
of false claims. Section 12653, subdivision (b), provides in pertinent part that no
employer may discharge an employee because that employee has acted lawfully in
disclosing false claims to law enforcement agencies. Section 12653, subdivision
(c), states that an employer who violates subdivision (b) shall be liable to pay all
the employee’s costs and damages, including litigation costs and attorney fees.
The last sentence of subdivision (c) provides, “An employee may bring an action
in the appropriate superior court of the state for the relief provided in this
subdivision.” Campbell contends that by operation of the rules of statutory
construction, this sentence relieved her of any requirement to exhaust
administrative remedies. Her contention fails, however, because it ignores the
sentence’s context.
As the Court of Appeal observed, Campbell presents no direct authority
supporting her position. Instead, she compares section 12653, subdivision (c),
with sections 12652, subdivision (d)(4), and 8547.10, in order to argue that the
Legislature intended to abrogate the exhaustion requirement in her action. To
analyze her argument, therefore, we first study section 12652’s relevant content.
Section 12652 sets forth procedures for the Attorney General to follow in
suing persons who have knowingly made a false claim for payment against the
government and performed other acts that violate section 12651. The Attorney
General must serve notice on the prosecuting authority of a political subdivision if
the false claim involved that entity’s funds as well as state funds. (§ 12652, subd.
(a)(2).) The prosecuting authority may intervene in the suit. (§ 12652, subd.
(a)(3).) A prosecuting authority that initiates a civil action for violation of section
12651 must notify the Attorney General, who may take primary responsibility for
maintaining the action. (§ 12652, subd. (b)(2), (3).) A person may bring a civil
action for a percent of the proceeds for a violation “of this article” as a qui tam
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plaintiff. (§ 12652, subd. (c)(1).) “Once filed, the action may be dismissed only
with the written consent of the court. . . .” (Ibid.) Qui tam plaintiffs shall file their
complaints in superior court in camera. The statute gives the Attorney General
and any involved political subdivision 60 days to decide whether to proceed with
the action. If the Attorney General’s office or the government agency does so, it
takes primary responsibility for prosecuting the action. It may then dismiss or
settle the action without the qui tam plaintiff’s consent. (§ 12652, subds. (c)(4),
(6), (e).)
Section
12652,
subdivision (d)(4), explicitly provides, “No court shall have
jurisdiction over [a qui tam action] based upon information discovered by a
present or former employee of [the government] during the course of his or her
employment, unless that employee first in good faith, exhausted existing internal
procedures for reporting and seeking recovery of the falsely claimed sums through
official channels and unless [the government] failed to act on the information
provided within a reasonable period of time.” (Italics added.) As the Regents
observe, this disclosure requirement for qui tam plaintiffs is designed to prevent
unjust enrichment of public employees who may have access to information
concerning false claims and who may be uniquely situated to detect fraud.
Therefore, before employees may reap the financial rewards that are available to
qui tam plaintiffs, they must first apprise their public employer of the false claims
and allow it to investigate and seek to recover any falsely claimed sums.
Employees may proceed as qui tam plaintiffs against a defrauding party only if
they have advised their public employer of the alleged fraud and it has failed to
act. (§ 12562, subd. (d)(4).)
Campbell characterizes the disclosure requirement for qui tam plaintiffs as
a statutory requirement to exhaust administrative remedies. But she
misunderstands the statute. Although it contains the words “exhausted” and
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“internal procedures,” the statute does not address employees’ grievances in cases
where employees must seek administrative remedies. The qui tam plaintiff
disclosure requirements are unique to the qui tam setting. They ensure that public
employers will have the opportunity to investigate and pursue fraud claims against
third parties before the employees can initiate any qui tam action against those
parties. In other words, section 12652, subdivision (d)(4), concerns administrative
procedures that employees must follow when they report false claims third parties
have made against the government and recover funds they have lost. By contrast,
the cases from Westlake to Schifando concern administrative remedies that an
employer provides when an employee has a grievance against it. Because section
12652, subdivision (d)(4), does not address an employee’s remedy for an alleged
grievance, it is irrelevant to our interpretation of section 12653, subdivision (c),
regarding application of the exhaustion rule.
Campbell’s reliance on the specific exhaustion requirements in section
8547.10, subdivision (c), of the California Whistleblower Protection Act is equally
unavailing. That statute provides that any person who intentionally retaliates
against a University of California employee for “having made a protected
disclosure” shall be liable for damages in an action the injured employee may
bring. (Ibid.) Section 8547.2 defines the term “protected disclosure” as “any good
faith communication that discloses or demonstrates an intention to disclose
information” about improper governmental activity or any condition that threatens
public or employee health or safety. (§ 8547.2, subd. (d).) This definition does
not exclude communications to governmental or law enforcement agencies.4

4
Section 8547.10 was amended by Statutes 1999, chapter 673, (1997-1998
Reg. Sess.) section 7, so that “made a protected disclosure” replaced the term
“disclosed improper governmental activities.” The same bill added the definition
of “protected disclosure” to section 8547.2. The change in terminology does not
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As the Regents observe, the statute permits aggrieved university employees
to file a damages action provided they have followed the administrative
procedures and filed an administrative complaint before filing their lawsuit.
(§ 8547.10, subd. (a).) Of note here, the employee may not proceed with a court
action against the university unless that institution has failed to reach an
administrative decision on the action within specified time limits. (§ 8547.10,
subd. (c).) In such a case, the employee may file a lawsuit for damages even
though the administrative complaint is pending. If, by contrast, the university has
reached a decision on the administrative action, the statute does not authorize any
statutory damages action.
Campbell contends that because section 8547.10, subdivision (c), includes
an explicit exhaustion requirement, section 12653, subdivision (c)’s silence on the
issue must be deliberate. She claims we are thus required to find that the latter
statute does not require her to have exhausted her administrative remedies before
filing the present action. We disagree. By enacting section 8547.10, the
Legislature created a specific exception to the administrative remedy rule. This
exemption was intended to augment other internal administrative procedures
available to university employees. As the Court of Appeal observed, the express
mention in one statute of a fundamental precondition of filing suit against an
administrative agency does not abrogate that requirement in every statute that is
silent on the matter. (Flores v. Los Angeles Turf Club (1961) 55 Cal.2d 736, 746-
747 [legislative silence on the exhaustion requirement does not manifest a
legislative intent to eliminate it]; see also A. Teichart & Son, Inc. v. State of Cal.
(1965) 238 Cal.App.2d 736, 746, disapproved on another ground by E.H. Morrill
Co. v. State of California (1967) 65 Cal.2d 787, 792.) The Legislature’s language

change our analysis of the effect of section 8547.10, subdivision (c), on the present
action.
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in the context of section 8547.10 says nothing about its intent under section 12653,
subdivision (c). Indeed, the Legislature’s silence in the latter statute makes the
common law exhaustion rule applicable here and requires employees to exhaust
their internal administrative remedies prior to filing a lawsuit.
Campbell also mistakenly relies on Hentzel v. Singer Co. (1982) 138
Cal.App.3d 290, 293, contending it holds that courts will not impose an
administrative remedies exhaustion requirement unless the statute specifically
mandates one. In Hentzel, the employee plaintiff sued for wrongful discharge,
alleging four common law causes of action. (Id. at p. 293) The Court of Appeal
addressed the tort cause of action for wrongful discharge in retaliation for the
plaintiff’s attempt to obtain a reasonably smoke-free work environment. The
employee’s allegation brought him within the scope of Labor Code section 6310,
which is part of the California Occupational Safety and Health Act legislation.
Labor Code section 6312 provides an administrative remedy for an employee who
is discharged in violation of Labor Code section 6310. (Lab. Code, § 6312 [upon
complaint, Division of Labor Standards Enforcement shall investigate; if there was
a violation of Labor Code, section 6310 found, it shall bring an action on behalf of
employee for back wages and injunctive relief].) The defendant employer claimed
the plaintiff’s failure to satisfy exhaustion requirements barred the lawsuit.
(Hentzel, supra, 138 Cal.App.3d at p. 300.)
The
Hentzel court found that the suit was not barred. It held that “[w]here a
statute creates a right that did not exist at common law, and provides a
comprehensive system of administrative enforcement, a requirement that
administrative remedies be exhausted may be implied. [Citation.] But, generally,
‘where a statutory remedy is provided for the enforcement of a pre-existing
common-law right, the newer statutory remedy will be considered only
cumulative.’ ” (Hentzel, supra, 138 Cal.App.3d at p. 301.)
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Campbell did not plead a wrongful discharge common law tort. Her
amended complaint sought damages under section 12653 and Labor Code section
1102.5, statutes that create a right that did not exist at common law. Similarly,
UCSF’s Policies and Procedures, which are equivalent to a statute, also create a
right that did not exist at common law and provide a comprehensive system of
administrative enforcement. Under Hentzel’s rationale, we may infer a
requirement that Campbell exhaust administrative remedies. (See also Grant v.
Superior Court (1978) 80 Cal.App.3d 606, 609 [finding exhaustion doctrine
applies under Public Resources Code section 30801 even though statute is silent
on doctrine and Legislature provides no express exemption from it].)
b. Labor Code section 1102.5
Campbell also seeks relief under Labor Code section 1102.5.5 Subdivision
(b) of that section provides that no employer may retaliate against an employee for
disclosing to a government or law enforcement agency information about
violations of law or failure to comply with regulations. For purposes of Labor
Code sections 1102.5 to 1105, Labor Code section 1106 defines “employee” as
including employees of the University of California.
Labor Code section 1105 states, “Nothing in this chapter shall prevent the
injured employee from recovering damages from his employer for injury suffered
through a violation of this chapter.” Campbell contends that this provision,
together with the chapter’s silence on administrative remedies, the effect of which

5
As the Regents observe in their letter brief of September 10, 2004, the
Legislature recently amended Labor Code sections 1102.5 and 1106 in order to
add a number of whistleblower-related provisions and additional penalties. (Lab.
Code, §§ 1102.5, 1106, amended by Stats. 2003 ch. 484, §§ 2, 7.) The
amendments, however, do not mention exhaustion requirements, nor do they
suggest that the exhaustion rule is inapplicable to whistleblower actions filed
under section 1102.5.
18

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we discuss ante, at pages 16-17, means that employees need not satisfy any
exhaustion requirement before they may file a lawsuit under Labor Code section
1102.5.
But this contention also ignores the provision’s context. Labor Code
section 1103 provides misdemeanor criminal penalties for a violation of the
chapter. Labor Code section 1104 makes the employer responsible for the acts of
all managers, agents, and employees “[i]n all prosecutions under this chapter.”
The placement of Labor Code section 1105 immediately after the provisions for
criminal prosecution of violations of the chapter seems intended to preserve
employees’ rights to file civil complaints for such violations. The context of
Labor Code section 1105, as well as the past 60 years of California law on
administrative remedies, argues against its abrogating the exhaustion requirement.
In addition, Labor Code section 1102.5’s silence on the exhaustion
requirement does not change our interpretation. As discussed ante, at page 16, and
as Torres recognized, “courts should not presume the Legislature in the enactment
of statutes intends to overthrow long-established principles of law unless that
intention is made clearly to appear either by express declaration or by necessary
implication.” (Torres, supra, 15 Cal.4th at p. 779.)
Campbell also asserts that the legislative history of Assembly Bill No. 3486
(1991-1992 Reg. Sess.), later codified as Labor Code section 1106, shows that the
Legislature intended Labor Code section 1102.5 to except University of California
employees from the requirement to exhaust administrative remedies. As noted
above, statutory construction begins with the statute’s language. (Torres, supra,
15 Cal.4th at p. 777.) In 2000, when Campbell filed her superior court suit, Labor
Code section 1106 stated in part: “For purposes of Sections 1102.5, 1103, 1104,
and 1105, ‘employee’ includes, but is not limited to, any individual employed by .
. . the University of California.” The statute’s plain language also does not
19

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support Campbell’s contention. The addition of section 1106 to the Labor Code
was intended to extend the rights available to private employees to include public
employees, and nothing more.
Campbell argues otherwise. She emphasizes that the Assembly Committee
on Labor and Employment, chaired by the bill’s author, did report on April 8,
1992, that the bill would give public employees the right to file a private action
without having to exhaust administrative remedies. The Assembly Ways and
Means Committee repeated this analysis on May 20, 1992. (Assem. Com. on
Ways and Means, Analysis of Assem. Bill No. 3486 (1991-1992 Reg. Sess.) as
amended April 21, 1992, p. 1.)
But when the bill reached the Senate, the analysis no longer mentioned the
exhaustion of administrative remedies. The Senate Committee on Industrial
Relations explained that while existing law prohibited employers from retaliating
against employees who disclosed to governmental or law enforcement agencies
information relating to violations of state or federal law, “These provisions are
silent as to their applicability to public employees. Generally, however, provisions
of the Labor Code apply only to employees in the private sector unless they are
specifically made applicable to public employees.” (Sen. Com. on Industrial
Relations, Analysis of Assem. Bill No. 3486 (1991-1992 Reg. Sess.) as amended
April 21, 2001 [2002], p. 2.) The report explained that the bill arose from a case
in which a local building inspector complained of retaliation because he reported
to the police that his supervisor had ordered him to violate the building inspection
law. (Id. at p. 3.) The district attorney declined to prosecute the supervisor,
however, because the Labor Code’s antiretaliation provisions applied to private
sector employees only. (Ibid.)
The Senate Rules Committee’s Third Reading Analysis reported these
arguments to support the bill: It would give public employees the same right of
20

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redress against retaliation for whistle blowing as the private sector enjoys; it would
encourage employees to report illegal activities without fear of retaliation; state
employees’ existing remedies were meaningless because they were required to
prove malice; public employees had little protection because they had to file a
complaint following the local agency’s procedures, and the supervisor who was
responsible for the retaliation often heard the first level of grievance. (Sen. Rules
Com., Off. of Sen. Floor Analyses, 3d reading analysis of Assem. Bill No. 3486
(1991-1992 Reg. Sess.) as amended April 21, 1992, pp. 2-3.) The Assembly
Committee on Labor and Employment, chaired by the bill’s author, offered a Fact
Sheet on Assembly Bill No. 3486 as amended (1991-1992 Reg. Sess.) which
included this question and answer: “Doesn’t this bill produce a duplication of
procedures? No. A public employer may still require whistleblowers to follow
their current procedures. This bill just empowers prosecutors and whistleblowers
to seek court action without proving malice.” (Assem. Com. on Labor and
Employment, Fact Sheet on Assem. Bill No. 3486 (1991-1992 Reg. Sess.), April
21, 1992, p. 1.) The Senate Floor Statement on the bill reiterated the argument
about eliminating the need to prove malice in a prosecution; it did not mention
elimination of the requirement to exhaust administrative remedies. (Id. at p. 2)
In sum, the legislative history is equivocal, initially indicating that the bill’s author
intended the bill to abrogate the exhaustion requirement, but later on revealing that
the Legislature may have rejected that intent in the statute it actually enacted. In
our view, therefore, the legislative history appears unclear on the question whether
the Legislature intended to depart from the exhaustion doctrine when it drafted
Assembly Bill No. 3486, and we cannot read that intent into the statute when the
history does not clearly support it.
21

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4. Choice of remedies
Campbell alternatively contends that even if we find an “implied”
administrative remedies exhaustion requirement under section 12653 subdivision
(c), and Labor Code section 1102.5, she should be able to choose between
pursuing an administrative or a judicial remedy. To support her contention, she
relies on City of Susanville v. Lee C. Hess Co. (1955) 45 Cal.2d 684, 689
(Susanville).
In
Susanville, a city council had awarded the respondent a contract for
public improvements. Four days later, at a special meeting held without notice to
the respondent, the council passed a resolution declaring the respondent to be an
unlicensed contractor unqualified to bid, and awarded the contract to another
bidder. The city then brought an action against the respondent in superior court, in
accord with the provisions of former Streets and Highways Code sections 5265 to
5270.6 The superior court found in favor of the city. When respondent appealed
to this court, the city argued that the respondent had failed to exhaust its
administrative remedy as required by Streets and Highways Code section 5003
because the statute provided that the exclusive remedy of anyone aggrieved by
error, irregularity, informality, neglect, or omission in the proceedings which
awarded a public improvements contract, shall be by appeal to the legislative
body. (Susanville, supra, 45 Cal.2d at p. 690.) We rejected the city’s contention

6
Former Streets and Highways Code section 5265 provided that “the
legislative body conducting the proceedings may bring an action in the superior
court . . . to determine the validity of such proceedings and . . . of any contract
entered . . . pursuant thereto.” Former section 5266 provided that the contractor
may also bring such an action. Former section 5267 specified that the action is in
rem and specified that summons is by publication. Former section 5268 provided
that anyone may appear and contest or uphold the validity of the proceedings and
of the contract. Former section 5269 provided whom to serve if the contractor
brought the action. Former section 5270 provided that appeal may be made to the
Supreme Court, and provided the time limit for actions and appeals.
22

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and found that the former Streets and Highways Code provided for an alternative
remedy. We held: “It is equally well settled that where a statute provides an
administrative remedy and also provides an alternative judicial remedy the rule
requiring exhaustion of the administrative remedy has no application if the person
aggrieved and having both remedies afforded him by the same statute, elects to use
the judicial one.” (Id. at p. 689.) Susanville is inapposite. In the present action,
no legislation corresponds to the detailed procedures for judicial remedy found in
the former Streets and Highways Code.
5. Equal protection
Campbell also asserts that requiring public employees who disclose false
claims against a public entity to exhaust their administrative remedies when
seeking redress for retaliation places a content-based restriction on their freedom
of speech. Campbell contends that by treating public employee whistleblowing
differently from private employee whistleblowing, the lower court made an
impermissible content-based discrimination against a type of speech. (See Police
Dept. of Chicago v. Mosley (1968) 408 U.S. 92, 95.) Mosley found
unconstitutional an ordinance that prohibited non-labor picketing. (Ibid.) But
requiring public employees to exhaust their administrative remedies as a
prerequisite to pursuing their claims of retaliatory discharge in superior court does
not restrict their freedom to disclose false claims.
Campbell also contends that the exhaustion requirement selectively
discriminates on the basis of viewpoint because it precludes lawsuits against
public entities. This claim misstates the effect of the exhaustion requirement,
because judicial review of the administrative determination is available via
administrative mandamus. (Code Civ. Proc., § 1094.5.)
23

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III. CONCLUSION
We conclude that absent a clear indication of legislative intent, we should
refrain from inferring a statutory exemption from our settled rule requiring
exhaustion of administrative remedies. Campbell has not shown that she either
attempted to exhaust her administrative remedies or that she should be excused
from doing so. We therefore find that Campbell has not shown that she could cure
the defects in her second amended complaint by amendment, even though the trial
court gave her ample opportunity to do so, and we find no abuse of discretion in
the trial court’s denying leave to amend. We hold that Campbell should have
exhausted the university administrative remedies before proceeding to suit, and
affirm the Court of Appeal’s judgment.
CHIN, J.
WE CONCUR:

GEORGE, C.J.
KENNARD, J.
BAXTER, J.
WERDEGAR, J.
BROWN, J.
MORENO, J.

24

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See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Campbell v. Regents of University of California
__________________________________________________________________________________

Unpublished Opinion

XXX NP opn. filed 12/23/02, 1st Dist., Div. 1
Original Appeal
Original Proceeding
Review Granted
Rehearing Granted

__________________________________________________________________________________

Opinion No.

S113275
Date Filed: March 7, 2005
__________________________________________________________________________________

Court:

Superior
County: San Francisco
Judge: David A. Garcia

__________________________________________________________________________________

Attorneys for Appellant:

Leo F. Donahue; Law Offices of Martin F. Jennings, Jr., Martin J. Jennings, Jr., and Stephan Mandell for
Plaintiff and Appellant.

E. Lyn Lemaire as Amicus Curiae on behalf of Plaintiff and Appellant.

__________________________________________________________________________________

Attorneys for Respondent:

Morgenstein & Jubelirer, William J. Carroll and Jennifer K. Achtert for Defendant and Respondent.

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Counsel who argued in Supreme Court (not intended for publication with opinion):

Stephan Mandell
Law Offices of Martin F. Jennings, Jr.
P.O. Box 2239
Granite Bay, CA 95746
(916) 791-2374

Leo F. Donahue
Law Offices of Leo F. Donahue
11344 Coloma Rd., #160
Gold River, CA 95670
(916) 859-5999

William J. Carroll
Morgenstein & Jubilerer
One Market, Spear Street Tower, 32nd Floor
San Francisco, CA 94150
(415) 901-8700

---

Opinion Information

Date:	Docket Number:
Mon, 03/07/2005	S113275

Disposition
Mar 7 2005	Opinion: Affirmed

Dockets
Jan 30 2003	Petition for review filed   by counsel for appellant (Janet Campbell)
Feb 7 2003	Received Court of Appeal record   file jacket/briefs/accordian file
Feb 19 2003	Answer to petition for review filed   By counsel for Respondent {The Regents of the University of California}.
Mar 19 2003	Petition for Review Granted (civil case)   Votes: George, CJ., Kennard, Baxter, Werdegar, Chin, Brown and Moreno, JJ.
Apr 2 2003	Certification of interested entities or persons filed   By counsel for Respondent {The Regents of the University of California}.
Apr 7 2003	Request for extension of time filed   By Appellant asking for a 30-day extension until May 19, 2003 to file Appellant's Opening Brief on the Merits.
Apr 8 2003	Certification of interested entities or persons filed   By Appellant {Janet Campbell}.
Apr 10 2003	Extension of time granted   On application of appellant and good cause appearing, it is ordered that the time to serve and file appellant's opening brief on the merits is extended to and including May 19, 2003.
May 1 2003	Request for extension of time filed   By Appellant asking until June 18, 2003 to file Appellant's Opening Brief on the Merits.
May 8 2003	Extension of time granted   To June 18, 2003 to file Appellant's Opening Brief on the Merits.
Jun 16 2003	Association of attorneys filed for:   Appellant {Janet Campbell}. Martin F. Jennings associates Leo Donahue and Stephan Mandell.
Jun 17 2003	Opening brief on the merits filed   In Sacramento by counsel for Appellant {Janet Campbell}.
Jun 17 2003	Request for judicial notice filed (in non-AA proceeding)   By Appellant {Janet Campbell}.
Jun 23 2003	Received:   Appellant's Notice of Errata to Appellant's Opening Brief on the Merits.
Jul 17 2003	Answer brief on the merits filed   By Respondent {The Regents of the University of California}.
Jul 17 2003	Request for judicial notice filed (in non-AA proceeding)   Respondent {The Regents of the University of California}.
Jul 31 2003	Request for extension of time filed   Appellant asking until September 11, 2003 to file Appellant's Reply Brief on the Merits.
Aug 5 2003	Extension of time granted   On application of appellant and good cause appearing, it is ordered that the time to serve and file Appellant's Reply Brief on the Merits is extended to and including September 11, 2003.
Sep 11 2003	Reply brief filed (case fully briefed)   In Sacramento by counsel for appellant Janet Campbell
Oct 2 2003	Received application to file amicus curiae brief; with brief   E. Lyn LeMaire supports appellant Janet Campbell
Oct 9 2003	Permission to file amicus curiae brief granted   E. Lyn Lemaire in support of appellant Janet Campbell.
Oct 9 2003	Amicus curiae brief filed   E. Lyn Lemaire in support of Appellant {Janet Campbell}. Answer is due within twenty days.
Oct 29 2003	Response to amicus curiae brief filed   By The Regents of the University of California to AC Brief filed by E. Lyn Lemaire.
Sep 10 2004	Received:   Letter from counsel for respondent {The Regents of the University of California} dated Sept. 10, 2004 to inform the court of recent decision in Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074. and the Legislature's Recent Amendments to Labor Code Section 1102.5.
Nov 3 2004	Case ordered on calendar   12/8/04 @ 9am., San Diego
Nov 10 2004	Filed:   Appellant's request to divide oral argument time.
Nov 30 2004	Order filed   The request of counsel for appellant to allow two counsel to argue on behalf of appellant at oral argument is hereby granted.
Nov 30 2004	Order filed   The request of appellant to allocate to Stephan Mandell 15 minutes and Leo Donahue 15 minutes of appellant's 30 minute allotted time for oral argument is granted.
Dec 8 2004	Cause argued and submitted
Mar 7 2005	Opinion filed: Judgment affirmed in full   Majority Opinion by Chin, J. ----- Joined by George, CJ., Kennard, Baxter, Werdegar, Brown and Moreno, JJ.
Mar 22 2005	Rehearing petition filed   By appellant {Janet Campbell} in pro per.
Mar 22 2005	Filed:   Appellant's {Janet Campbell} Substitution of Attorney.
Mar 24 2005	Time extended to consider modification or rehearing   To June 16, 2005.
May 18 2005	Rehearing denied
May 18 2005	Remittitur issued (civil case)
May 19 2005	Received:   Receipt for Remittitur from 1 DCA .
Aug 29 2005	Received:   notice of writ of certiorari to United States Supreme Court docketed 8-19-05 # 05-233.
Oct 17 2005	Received:   copy of order from the US Supreme Court denying certiorari on Oct.11, 2005.

Briefs
Jun 17 2003	Opening brief on the merits filed
Jul 17 2003	Answer brief on the merits filed
Sep 11 2003	Reply brief filed (case fully briefed)
Oct 9 2003	Amicus curiae brief filed
Oct 29 2003	Response to amicus curiae brief filed

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