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Vector Resources, Inc. v. Baker

California Court of Appeals, Fourth District, First Division

May 26, 2015

VECTOR RESOURCES, INC., Plaintiff and Appellant,
v.
CHRISTINE BAKER, as Director, etc., et al., Defendant and Respondent.

APPEAL from a judgment of the Superior Court of San Diego County, No. 37-2012-00097974- CU-MC-CTL Joel R. Wohlfeil, Judge.

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COUNSEL

Sheppard, Mullin, Richter & Hampton, Richard M. Freeman and Matthew S. McConnell for Plaintiff and Appellant.

Christopher Jagard and John J. Korbol for Defendants and Respondents.

OPINION

NARES, Acting P. J.

This action arises out of a determination by the Department of Industrial Relations (the Department) that plaintiff Vector Resources, Inc. (Vector) failed to pay the appropriate prevailing wages to its workers on a public works project for the San Diego Unified School District. Specifically, the Director of Industrial Relations (the Director) issued a decision in which she found that Vector underpaid its employees by failing to pay a higher "shift differential" rate for work performed during shifts commencing after 12:00 noon. The director's decision was based on regulatory language in a document entitled "Important Notice To Awarding Bodies and Other Interested Parties Regarding Shift Differential Pay in the Director's General Prevailing Wage Determinations" (the Important Notice), which was posted on the Department's Web site. The Important Notice addresses shift differential pay for various crafts used on public works projects, and is augmented by additional regulatory language in a "Note" that the Department

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places on the cover page of prevailing wage shift provisions. The parties refer to this Note as "the Stamp."[1]

Vector filed a declaratory relief action against the Department, seeking a declaration that the Important Notice and Stamp are invalid and unenforceable as "underground regulations" because they were not promulgated in compliance with the notice and hearing requirements of the Administrative Procedure Act (APA). (Gov. Code, § 11340 et seq.)[2] Vector and the Department filed cross-motions for summary judgment, based largely on stipulated facts. The court granted the Department's motion on the ground that under Government Code section 11340.9, subdivision (g), the Important Notice and the Stamp are exempt from the notice and hearing requirements of the APA because they are part of an overall prevailing wage determination process that constitutes "rate setting."

Vector contends the summary judgment in favor of the Department must be reversed because (1) the Department admitted that the shift premium rule is a regulation, (2) the Department admitted that that regulation was not adopted in compliance with the APA, (3) the Department failed to prove that the shift premium regulation establishes or fixes rates within the meaning of Government Code section 11340.9, subdivision (g), (4) the court erred in failing to specifically cite the evidence it relied on to grant summary judgment, (5) the court's written order ignored the law and the admissible evidence, and (6) the Department's motion relied upon inadmissible evidence. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

A. Factual Background

The factual background is largely based on facts to which the parties stipulated in support of their ...


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