CERTIFIED FOR PARTIAL PUBLICATION[*]
ORIGINAL PROCEEDINGS; petition for writ of mandate. Hurl W. Johnson III, Judge. Super. Ct. No. 670117
Herum Crabtree, Brett S. Jolley and Natalie M. Weber for Petitioner.
No appearance for Respondent.
Michael L. Lyions, City Attorney; Meyers, Nave, Riback, Silver & Wilson, Amrit S. Kulkarni and Edward Grutzmacher for Real Party in Interest City of Ceres.
K & L Gates, Edward P. Sangster for Real Parties in Interest, Wal-Mart Stores, Inc., and Wal-Mart Real Estate Trust.
Jennifer B. Hennings for California State Association of Counties and League of California Cities as Amici Curiae on behalf of Respondents, City of Ceres, Wal-Mart Stores, Inc., and Wal-Mart Real Estate Trust.
Wiseman, Acting P.J.
This case involves a challenge under the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.) (CEQA) to a decision by the City of Ceres (city) to grant approvals necessary to build a shopping center anchored by a Wal-Mart store. The challenger, Citizens for Ceres, has petitioned this court for writ relief from the trial court’s order upholding claims by the city and the developer that hundreds of documents be excluded from the administrative record because they are protected by the attorney-client privilege or the attorney work-product doctrine.
The dispute over these documents arose when the challengers pointed out that the administrative record prepared and certified by the city included no communications between the city and the developer. The city responded that the project had “the potential to be controversial”; that such communications therefore “were always made by and between legal counsel” for the city and the developer; and consequently all the communications were privileged. The challenger filed a motion to augment the administrative record by compelling the city to include the assertedly privileged communications. The trial court denied the motion, leading to these writ proceedings.
We reject the challenger’s argument that CEQA’s provisions defining the administrative record abrogate the attorney-client privilege and the attorney work-product doctrine. Those CEQA provisions do not reflect an intent on the part of the Legislature to eliminate privileges wholesale.
We conclude, however, that the common-interest doctrine, which is designed to preserve privileges from waiver by disclosure under some circumstances, does not protect otherwise privileged communications disclosed by the developer to the city or by the city to the developer prior to approval of the project. This is because, when environmental review is in progress, the interests of the lead agency and a project applicant are fundamentally divergent. While the applicant seeks the agency’s approval on the most favorable, least burdensome terms possible, the agency is duty bound to analyze the project’s environmental impacts objectively. An agency must require feasible mitigation measures for all significant impacts and consider seriously and without bias whether the project should be rejected if mitigation is infeasible or approved in light of overriding considerations.
The applicant and agency cannot be considered to be advancing any shared interest when they share legal advice at the preapproval stage. Under established principles, this means that the common-interest doctrine does not apply. After approval, by contrast, the agency and applicant have a united interest in defending the project as approved, and privileges are not waived by disclosures between them from that time onward. In making this distinction between preapproval and postapproval disclosures, we potentially disagree with California Oak Foundation v. County of Tehama (2009) 174 Cal.App.4th 1217, 1222-1223 (California Oak), in which the court found the common-interest doctrine to be applicable to postapproval disclosures between an applicant and a lead agency and perhaps also to preapproval disclosures between them. We will grant writ relief to allow the trial court to apply the rule we have stated.
In the unpublished portion of the opinion, we consider several additional topics. First, we discuss the showing necessary to establish the common-interest doctrine’s protection for any postapproval communications for which it may be claimed. Second, there are many other assertedly privileged documents that were not disclosed between the city and the developer. It will still be necessary for the trial court to reexamine those privilege claims because the court applied an incorrect standard in upholding them. In upholding all the challenged privilege claims without exception, the court expressed the view that the party asserting a claim of privilege need only assert it to obtain protection. In reality, the party asserting the privilege is required to make a showing of preliminary facts supporting the privilege. The court made no findings of these preliminary facts, and there is no substantial evidence in the record that would have supported those findings for any document. The city will be permitted to amend its submissions to make the necessary showings.
Next, some of the assertedly privileged documents are also claimed by the city to be excludable from the administrative record because they are “drafts” within the meaning of section 21167.6, subdivision (e)(10). The parties have a dispute over the scope of this exclusion. More broadly, the city argues that, even if none of the documents at issue are protected by privileges, they all belong to a phase of the environmental review that is excluded from the administrative record. This argument is based on a reading of section 21167.6, subdivision (e)(10), which, we conclude, it is unnecessary for us to rule upon in these writ proceedings. The trial court has not yet made any ruling on the subject and should do so in the first instance if necessary.
Finally, we reject four arguments for denying writ relief which are based on the allegations that: (1) the challenger forfeited most of its challenges to the privilege claims by not presenting them properly in the trial court; (2) the challenger has not made a showing of prejudice; (3) the challenger failed to exhaust administrative remedies; and (4) the writ petition in this court is defective in form.
We issue a writ of mandate requiring the trial court to reconsider the claims of privilege in light of the holdings in this opinion.
FACTUAL AND PROCEDURAL HISTORIES
Real parties in interest Wal-Mart Stores, Inc. and Wal-Mart Real Estate Trust (the developer) applied to the city for land-use approvals necessary to build a 300, 000-square-foot shopping center anchored by a 200, 000-square-foot Wal-Mart store. On September 12, 2011, the city certified an environmental impact report (EIR) and approved the project. The challenger initiated proceedings in the superior court, claiming the city failed to comply with CEQA.
After the city prepared a draft index for the administrative record, the challenger sent a letter to the city, stating:
“The index … does not appear to include a single informal communication (such as [an] email or memo) between the agency and its consultants or the applicant. In my experience representing applicants as well as my experience with CEQA administrative records, there are typically lengthy communications between the applicant and the agency in this form and these are appropriately included in the record.… Yet the index is completely devoid of such communications or notes. In fact, it does not appear the agency staff/consultant e-mail accounts were reviewed for Communications related to this matter. Please explain whether this is an oversight that will be corrected or a deliberate omission. [¶] If the latter, please explain the basis for the omission and if claimed for reasons of privilege, please provide a privilege log or similar device.…”
Counsel for the city answered in a letter stating that the omissions of communications between the city and the developer were deliberate and based on privilege. The city had deliberately structured all communications to be privileged because it anticipated that the project would be controversial and could lead to litigation, and that the city had no intention of providing any information at all about the withheld documents:
“From the very earliest stages of the City’s consideration of this project, it was clear that the project had the potential to be controversial and that there was a relatively high risk of litigation. Thus, from the very earliest stages of the City’s consideration of the project, both the City and the project applicant retained legal counsel to assist with, and oversee compliance with CEQA and all other relevant laws and regulations. Communications, therefore were always made by and between legal counsel. These communications are protected from disclosure by the attorney-client privilege, the [attorney work-product] doctrine, the legislative privilege, the joint defense privilege, and, potentially, other privileges and protections. CEQA does not require the City to include any such privileged or protected documents in the administrative record or to waive any of these protections and privileges in preparing an administrative record. CEQA also does not require the preparation of a privilege log, as you have requested, and the City will not provide any such privilege log.”
On December 19, 2011, the city certified the administrative record without including any of these communications.
The challenger filed an objection to the certification of the record because of the omission of the communications. Later, the challenger filed a motion asking the trial court to order the city to augment the administrative record to include them. The motion argued that communications between the city and the developer, as well as the city’s internal communications, were required to be included in the administrative record by section 21167.6, subdivision (e). The challenger further argued that, because section 21167.6 states that it applies “‘notwithstanding any other provision of law, ’” no privileges applied.
In its opposition to the motion, the city informed the court that it had agreed to provide a privilege log, although it continued to maintain that it was under no obligation to do so. The log, as later supplemented, listed 3, 311 documents. An overwhelming majority of the log entries indicated that the city was claiming the attorney-client privilege, the protection of the attorney work-product doctrine, or both. Many entries also indicated that, although the documents were disclosed between the city and the developer, waiver of privileges was prevented by the common-interest doctrine. The log actually refers to a joint-defense privilege, but, as we will explain, California has no joint-defense privilege. The city’s intention was to refer to the nonwaiver effect of the common-interest doctrine.
The city explained that there also were two groups of documents withheld for reasons other than privilege. One group was “administrative draft documents or documents not otherwise released to the public.” The other was documents related to a development agreement that was expected to be part of the project at an earlier stage but that had since been abandoned.
As far as we can tell from the record, the city provided little information on the basis of which it would be possible to determine whether any of the claimed privileges or protections applied. A total of about three dozen names appear in the privilege log as the names of people by or to whom documents were sent. With a few exceptions, however, neither the log nor any declaration supporting it provides any information identifying these people, stating which of them are attorneys or clients, or explaining which parties they represented or worked for. From the record as a whole, we have been able to identify six of them as attorneys for the city or the developer. There was, however, no straightforward way to identify the other 30 or so individuals listed. Further, although the record contains four declarations related to the assertedly privileged documents, none of these state the declarants’ personal knowledge that any of the documents were communications made in the course of an attorney-client relationship or were the work product of an attorney, with the exception of four items said to be attorney work product. Two declarations stated that the city and the developer sometimes disclosed privileged communications to each other and did so in pursuit of their common interests and with the expectation that the communications would remain confidential. The declarations did not, however, state that this was true, to the declarants’ personal knowledge, regarding any or all of the common-interest documents listed in the log except for four documents. For about 650 other documents where the protection of the common-interest doctrine is claimed in the log, there are no supporting facts.
The court held its first hearing on the motion to augment on April 20, 2012. The parties had formal meet-and-confer discussions in a jury room, and the hearing was continued. After the April 20 hearing, the challenger provided the city with a list of 2, 275 privilege claims that it was disputing. On May 18, 2012, the city sent a chart indicating its responses regarding these disputed items. The responses indicated that the city had decided to disclose, and had already disclosed, a significant number of the documents. For the majority, however, the city adhered to its privilege claims—at least provisionally.
In a letter to the court dated May 23, 2012, describing the “issues that still remain between the parties, ” the challenger reserved its right to maintain its challenges to the 2, 275 items about which the city had supplied responses:
“[O]n May 18, 2012 the City provided responses … to the Initial and Supplemental log lists of requested documents provided by Petitioner on April 20th and April 25th, respectively. Because these responses were not provided in conjunction with documents produced on May 7th, Petitioner has not had sufficient time to review these responses yet to determine their adequacy and/or whether they further answer issues raised herein. Thus, Petitioner reserves the right to object to any changes to the privilege logs or the City Responses.”
In a letter to the court dated May 24, 2012, the city stated that its review of the 2, 275 challenges “has provided the opportunity to make necessary changes to the privilege log, ” and it would submit an amended log “when the City is sure that no further changes will need to be made.” This implied the city was uncertain which of its privilege claims actually were valid.
In his letter to the court dated May 23, 2012, the challenger’s counsel described the city’s production of “thousands of documents” after the April 20 hearing. These are documents conceded to be within CEQA’s description of the administrative record in section 21167.6, subdivision (e), but omitted from the administrative record that was certified by the city on December 19, 2011. Instead of promptly submitting these documents to the court to be included in the administrative record, the city apparently expected the challenger to review them and determine which ones it wanted to include. The city’s position was that it did not object to the inclusion of any of them. In a letter to opposing counsel dated May 7, 2012, counsel for the city remarked that, although the privilege log “references a large number of administrative draft sections of the EIR, ” he found that it was “nearly impossible to match these documents to specific entries on the privilege log” his office had prepared months before. Further, the privilege log itself includes many entries for which privileges are claimed but no individuals are named as those participating in the communication. Ninety-three of these entries still had not been corrected by the time the parties submitted their final briefs preceding the July 6, 2012, hearing. This indicates that, at the time the city certified the administrative record and for seven months afterward, it never made a final determination of the documents it believed should be included in the administrative record or of the documents it wanted to claim it could withhold and why.
The court held another hearing on May 25, 2012. The court and parties discussed four categories of documents and agreed there were no other categories. The court and parties also expressed an expectation that the list of disputed documents would be narrowed by the time of the next hearing, so that the city and the developer could give a general indication of the substance and purpose of the documents, the challenger could make arguments based on that additional information, and the court could rule. The court stated that, after the parties had determined the set of documents remaining in dispute, they would submit simultaneous briefs arguing for and against the privilege claims on those documents. The court and parties did not refer to any specific limitation on the number of documents that could or would ultimately remain in contention.
When the simultaneous briefs were filed on June 26, 2012, it was obvious that the parties had not reached any agreement about the number of documents that remained in contention. The challenger attached to its brief a list of more than 500 documents and asked the court to order their disclosure. The city’s brief discussed 25 documents, implying that only these remained in dispute, while the developer’s brief asserted that the parties “have boiled the disputed issues down to” 19 documents and redactions in 13 other documents.
The belief of the city and the developer that a drastic reduction in the scope of the dispute had taken place appears to be based on the challenger’s letter of June 14, 2012, in which the challenger discussed 50 documents. That letter did not, however, state that it contained the challenger’s list of the privilege claims being challenged. Instead, it explained that it contained the challengers’ remarks on certain documents the city and developer had already produced, some of which the challengers were arguing should be included in the administrative record. It also stated the challengers’ responses to a new set of privilege claims asserted by the city in a recent letter. The letter did not contain any agreement to abandon the challenges to any of the privilege claims.
On June 29, 2012, counsel for the city and the developer wrote to counsel for the challenger to express their “outrage” at the fact that a large number of documents remained in dispute; they claimed there was an “extreme disconnect” between the challenger’s statements at the May 25 hearing and its list of disputed documents in its June 26 brief. Counsel for the challenger wrote back that the challenger “has repeatedly stated that [it] does not waive any rights or claims to documents” and “has never agreed to limit its request” for documents in the manner the city and the developer assumed.
The final hearing on the challenger’s motion to augment the administrative record took place on July 9, 2012. The court expressed surprise that a large number of documents was still in dispute. “I got the impression we were down to 30-some odd documents, ” it said. This impression appears to have been derived from the city and developer’s submissions alone, since the challenger’s brief included a list of more than 500 disputed documents. The city’s attorney said there were “[c]lose to 700, ” the developer’s attorney agreed, and the court often referred to that figure, but we have found no basis for it in the record.
The court indicated that if there had been a small number of documents, and if the city had been willing to provide them for in camera review, there would have been no problem. On the other hand, with the large number of documents that the city was unwilling to produce, the court did not know how to cope with the task of ruling on the privilege claims:
“I thought we were down to 32 or 35, something manageable based upon these letters that I got … so I came in here with the idea today, hey, I got 30-some odd documents I have to look at. Hopefully the city attorney will give me some of these things that may be attorney/client privilege, so I can look at that small universe of documents, and then I can make a decision. [¶] Whichever way I can make a decision, I disclose some of those 30-odd documents or some of them I would or maybe I wouldn’t disclose any, but then I’d have a nice packet. And I’d seal it up and say, here, do what you want with it if somebody wants to take a writ. [¶] But what am I supposed to do with 700 of these things? How do I make a determination if 700 documents I’m not being shown qualifies as attorney/client privilege? [¶] Anyone?”
The court later said it felt “blindsided” by the fact that the challenger was still challenging several hundred of the city’s original 3, 311 privilege claims. “I went from 32 documents, and now I’m supposed to do 700, ” it added, again apparently relying on the city’s and the developer’s representations about only a few documents being in dispute. “That’s not what I had in mind.” A moment later, it said, “And I’m not going to look at 700, so give me an example.” Still later, it said, “I thought okay, well, 32, I can do 32. No problem. I can’t do 700.…”
Several times, the court stated its view that a party asserting a privilege had no burden beyond the mere assertion itself, while the party opposing the privilege claim had a burden of proving the privilege was inapplicable:
“You have the burden. They claim attorney/client privilege. They have the right to claim that as officers of the court. It’s your obligation, your burden, to tell me why they’re not attorney/client privilege. [¶] … [¶]
“You have the burden to say what they’re saying as officers of the court is not true. That’s what you have to do on this thing.… [¶] … [¶]
“They’re officers of the Court. They’re claiming a privilege, which I cannot force them to give up. Then the law says under privileges, attorney/client, just about any other privilege, the person … who wants to say it’s not claimed by a privilege, has the burden to show that it’s not within a privilege.… [¶] … [¶]
“They don’t have to tell me why it is attorney/client privilege. They can say, Judge, mind your own business. We’re claiming a privilege. That’s what the law says.”
Finally, saying “I don’t know what else to do with this, ” and “I’m getting to the point where we need to get this thing resolved one way or the other, ” the court made a blanket ruling upholding all the privilege claims on the ground that the city and the developer had asserted the claims and the challenger had not disproved their applicability:
“I’m making the finding you have as officer of the court, they have the right to say attorney/client work product. They have done so.… You can’t make your requirement … to show me that it’s not carried, and it’s not protected by attorney/client or work product.… [¶] I’m not going to order any further review on these attorney/client [or] work product.”
After discussing some other matters, the court set a hearing on October 5, 2012, for determination of the merits, with the challenger’s opening brief due on August 24.
The challenger filed its petition for a writ of mandate in this court on September 7, 2012, seeking relief from the trial court’s order. The petition argues that the allegedly privileged documents should be ordered included in the administrative record because section 21167.6 renders all privileges inapplicable. Alternatively, the petition argues that several hundred of these documents should be ordered included in the administrative record because respondents never made the necessary showing of preliminary facts to establish that the privileges apply to the documents for which they are claimed.
We issued a stay order on September 17, 2012. On the same day, the city filed a “Preliminary Opposition” to the writ. On September 18, 2012, Wal-Mart filed an “Informal Opposition.”
The preliminary and informal opposition briefs make six arguments: (1) The matter is not ripe for review because the trial court has not filed a written order embodying its ruling from the bench, and Court of Appeal, Fifth District, Local Rules of Court, rule 3(b) (rule 3(b)), requires a “a copy of the order or judgment from which relief is sought” to be attached to the writ petition. (2) The city and developer “are currently asking the trial court to directly address” their purported failure to establish the preliminary facts necessary to show that privileges apply and “intend to ask the Superior Court to defer entry of an order pending preparation of a new privilege log by the City.” (3) The challenger forfeited its arguments because it blindsided the city and developer in the trial court by stating in its final brief before the hearing that several hundred documents were at issue. (4) The challenger has not shown that it will be prejudiced at trial by its lack of access to the withheld documents. (5) Having no access to the withheld documents, the challenger was not able to raise any issue that might be found in them during the administrative proceedings, so the challenger has failed to exhaust its administrative remedies for any issue that might be found in them. (6) Section 21167.6 does not supersede the attorney-client privilege or the attorney work-product doctrine.
On October 3, 2012, we issued an order to show cause why relief should not be granted. Included in the order to show cause was a briefing order, stating:
“The parties’ submissions should include, but need not be limited to, responses to the following questions:
“1. Did respondents sustain their burden of establishing preliminary facts necessary to support all their claims of attorney-client privilege and attorney work product protection? If not, what additional declarations or other evidence must they submit to sustain this burden? Is their burden different when the privilege log shows that an attorney merely received a ‘cc’ of a document?
“2. For communications between the city and its attorneys and for work product of the city’s attorneys, disclosure to Wal-Mart waives privileges unless the common interest doctrine applies. Likewise, for communications between Wal-Mart and its attorneys and for work product of Wal-Mart’s attorneys, disclosure to the city waives privileges unless the common interest doctrine applies.
“(a) For privilege log entries that show disclosure between the city and Wal-Mart, which side has the burden of showing that privileges are or are not preserved under the common interest doctrine? What facts must be shown? What kinds of evidence can show those facts? Does the record contain substantial evidence on the basis of which the trial court could find that the doctrine protected each document for which it was claimed, assuming respondents had a burden of producing such evidence? Should the trial court have conducted an in-camera review to determine whether the common-interest doctrine applies to each document for which it was claimed? (See OXY Resources California LLC v. Superior Court (2004) 115 Cal.App.4th 874.)
“(b) In light of a lead agency’s position under CEQA as an objective decision-maker, should communication between an applicant and lead agency that takes place before the agency has completed environmental review and approved the project be deemed to be generally outside the common interest doctrine? (Cf. [California Oak, supra, ] 174 Cal.App.4th 1217, 1222-1223 [stating that in CEQA litigation by challenger against applicant and lead agency, ‘disclosing the [legal] advice to a codefendant in the subsequent joint endeavor to defend the EIR in litigation’ does not waive privileges because of the common interest doctrine (italics added)].)
“3. Besides those already discussed in the petition and in respondents’ informal opposition briefs, are there any arguments or authorities that would help the court to determine whether the clause ‘[n]otwithstanding any other provision of law’ in Public Resources Code section 21167.6 should be construed as superseding or limiting any privileges? (See, e.g., Remy, et al., Guide to CEQA (11th ed. 2006) pp. 859-861.)
“4. According to the privilege log, many of the items challenged by petitioner not only are privileged, but also are excluded from the administrative record because they are ‘drafts’ within the meaning of Public Resources Code section 21167.6, subdivision (e)(10). Does petitioner intend to challenge the ‘draft’ designation of these items, or instead to concede that because of the designation, petitioner’s challenges to the privileges ...