Oxford Preparatory Academy v. Chino Valley Unified School Dist.

Filed 7/11/19

CERTIFIED FOR PUBLICATION

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

OXFORD PREPARATORY ACADEMY, D074703

Plaintiff and Appellant, (Super. Ct. No. CIVDS1710045)

v.

CHINO VALLEY UNIFIED SCHOOL
DISTRICT et al.,

Defendants and Respondents.

APPEAL from a judgment of the Superior Court of San Bernardino County, David

S. Cohn, Judge. Reversed and remanded with directions.

Theodora Oringher, Brian J. Headman, Jon-Jamison Hill; Connor, Fletcher &

Hedenkamp, Edmond M. Connor, Matthew J. Fletcher, and Douglas A. Hedenkamp for

Plaintiff and Appellant.

California Charter Schools Association, Ricardo J. Soto, Julie Ashby Umansky,

and Phillipa Altmann for amicus curiae on behalf of Plaintiff and Appellant.

Law Offices of Margaret A. Chidester & Associates, Dylan E. Conroy, Steven R.

Chidester, and Margaret A. Chidester for Defendants and Respondents.
 This appeal arising from a mandamus action in the superior court presents novel

issues regarding the proper scope of judicial review of a school district's decision to deny

a petition to renew a charter school. Below, the trial court concluded it had to apply an

extremely deferential standard of review because it believed the governing board of the

Chino Valley Unified School District (District) was performing a quasi-legislative action

when it denied the renewal petition submitted by Oxford Preparatory Academy (the

Academy), an existing charter school within the District. Finding that the District's

decision was not arbitrary or capricious, the trial court denied the Academy's writ

petition.

On appeal, the Academy contends the trial court applied the incorrect standard of

review because the District's decision was quasi-judicial in nature and, therefore, the trial

court should have applied a less deferential standard of review.

In this matter of first impression, we conclude that a school district's decision

pursuant to Education Code sections 47605 and 476071 to deny a charter school's

renewal petition is a quasi-judicial action subject to review via a petition for

administrative mandamus. In considering a renewal petition, the school district is not

acting in a legislative function by creating new policy, but rather performing a quasi-

judicial function by applying existing standards and rules defined by state statute to

determine whether the evidence presented by the charter school regarding its past

1 All further statutory references are to the Education Code unless otherwise
specified.
2
performance is sufficient to satisfy those standards. The applicable statutes allow the

District to deny a renewal petition only after conducting a hearing and making specific

factual findings. This process bears all the hallmarks of a quasi-judicial action.

Additionally, we conclude that after a charter school's initial petition is approved by a

school district, the petitioner has a fundamental vested right to continue operating the

charter school such that a school district's decision that deprives the petitioner of that

right is subject to independent judicial review.

The trial court did not apply these standards when reviewing the District's

decision. Accordingly, we must reverse and remand for reconsideration of the

Academy's writ petition under the correct standards.

FACTUAL AND PROCEDURAL BACKGROUND

In 2009, the District granted the Academy's initial petition to open a charter school

within the District. The Academy opened in the fall of 2010 for its first school year and

ultimately enrolled approximately 1,200 children in kindergarten through eighth grade.

Near the end of its initial two-year charter, the Academy sought and obtained a

five-year renewal to operate its charter school through June 30, 2017. As the end of the

renewal period approached, the Academy submitted a petition for renewal to the District

in January 2016. Due to concerns regarding financial irregularities and the Academy's

governance structure, the District board denied the renewal petition in March 2016.

In response, the Academy made significant changes to its structure and financial

relationships to address the District's concerns. It then submitted a new renewal petition

reflecting these changes in September 2016. In its 617-page petition, the Academy

3
detailed its academic success over the past five years, relying on academic test scores and

other metrics to claim it was "the top performing K-8 public school in San Bernardino

County."

As required by state law, the District held a public hearing on the renewal petition

in October 2016. At its next meeting in November, the District board voted unanimously

to deny the renewal petition. In a detailed 62-page resolution, the board made numerous

findings of fact to support its conclusions that: (1) the Academy was "demonstrably

unlikely to successfully implement the program set forth in the . . . charter renewal

petition. [Citation]"; (2) the "renewal petition fails to contain reasonably comprehensive

descriptions of eight of the fifteen required elements of a charter petition. [Citation]";

and (3) the "charter renewal petition fails to provide all of the required affirmations and

assurances required to comply with California State law. [Citation.]"2 (Boldface

omitted.)

Following the procedures defined by state law, the Academy appealed the

District's decision to the San Bernardino County Office of Education, which declined to

consider the appeal. The Academy then appealed to the California State Board of

Education, which denied the appeal.

2 The District's decision is supported by detailed factual findings regarding its
concerns about the Academy's leadership and financial irregularities. We do not delve
into the details of those findings not because we consider them to be inconsequential, but
rather because they are irrelevant to our analysis. For the reasons discussed post, our
holding as to the preliminary error by the trial court regarding the proper standard of
review precludes our analysis of the merits of the District's decision. We express no
opinion as to whether the District's decision is supported by sufficient evidence.
4
 The Academy then sought judicial relief. It filed a petition for writ of mandate in

the superior court and requested a temporary restraining order to allow it to continue

operation during the pendency of the lawsuit. The trial court granted the restraining order

pending its final decision.

The Academy argued that it was seeking writ relief under sections 1094.5 and

1085 of the Code of Civil Procedure. It argued the trial court should apply its

independent judgment to determine whether the District's decision was supported by the

weight of the evidence.

The District responded by claiming that the trial court should instead apply a

deferential standard of review limited to "an examination of whether the agency's actions

were arbitrary, capricious, or entirely lacking in evidentiary support."

At the hearing on the petition, the court focused on determining the proper

standard of judicial review. As the court explained, it believed "the linchpin of this

analysis is whether this is quasi-legislative or quasi-judicial." The court expressed its

belief that if the District's decision was quasi-judicial and the heightened standard of

review applied, it did not believe the District made the necessary findings to support its

denial of the charter renewal petition. In the end, the court conceded this was a "very

close case," but concluded the District's decision was quasi-legislative. Applying the

deferential standard of review, the court then denied the writ petition.

The court subsequently entered a judgment in favor of the District. The Academy

appeals.

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 DISCUSSION

I. The District's Motion to Dismiss

As a preliminary matter, the District filed a motion to dismiss the Academy's

appeal, claiming that since the Academy did not open for the new school year in the fall

of 2017 and began the closure process, the pending appeal was rendered moot. It further

contends that the issues raised on appeal do not involve matters of "continuing public

interest" warranting adjudication of the appeal despite the alleged mootness.

In opposition, the Academy rejects the contention that this court cannot offer any

effective relief. It admits that its school is no longer operating and the District has

retaken the physical school site, but contends this "interim lapse" in operation does not

preclude effective judicial relief by compelling the District to reconsider the Academy's

renewal petition or to find that the Academy's petition was renewed by operation of law.

"An appeal should be dismissed as moot when the occurrence of events renders it

impossible for the appellate court to grant appellant any effective relief." (Cucamongans

United for Reasonable Expansion v. City of Rancho Cucamonga (2000) 82 Cal.App.4th

473, 479 (Cucamongans).) Here, the parties fundamentally disagree on whether the

closure of the Academy after this appeal was filed renders it impossible for this court to

grant any relief.

Although it will undoubtedly be difficult for the Academy to reopen if it succeeds

in this judicial action, the District does not establish that it would be impossible for the

Academy to do so.

6
 In the end, however, we need not resolve this largely factual dispute. "[T]here are

three discretionary exceptions to the rules regarding mootness: (1) when the case

presents an issue of broad public interest that is likely to recur [citation]; (2) when there

may be a recurrence of the controversy between the parties [citation]; and (3) when a

material question remains for the court's determination [citation]." (Cucamongans,

supra, 82 Cal.App.4th at pp. 479-480.)

The issues raised in this appeal regarding the proper standard for judicial review of

a school district decision denying a charter school renewal petition are of broad public

interest and likely to recur. Additionally, if the District is correct that a charter school's

judicial action challenging the denial of its charter renewal petition becomes moot as

soon as a new school year starts, such controversies are likely to evade normal appellate

review. Thus, even if the appeal is now moot, exercising our discretion to decide the

issues presented is particularly appropriate. (Chantiles v. Lake Forest II Master

Homeowners Assn. (1995) 37 Cal.App.4th 914, 921.) Accordingly, the motion to dismiss

the appeal is denied.

II. Quasi-Judicial vs. Quasi-Legislative

Turning to the merits, the central issue on appeal is the proper standard of judicial

review for a district's decision to deny a charter school's renewal petition. This issue of

first impression turns on whether the District's decision was quasi-legislative—

reviewable via a traditional mandamus action—or quasi-judicial—reviewable via an

administrative mandamus action.

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 A traditional mandamus action proceeds under section 1085 of the Code of Civil

Procedure and recognizes that quasi-legislative decisions of administrative agencies are

entitled to greater deference. "Judicial review of a legislative act under Code of Civil

Procedure section 1085 is limited to determining whether the public agency's action was

arbitrary, capricious, entirely without evidentiary support, or procedurally unfair." (San

Francisco Tomorrow v. City and County of San Francisco (2014) 229 Cal.App.4th 498,

509.)

A petition for a writ of administrative mandate, on the other hand, presents "the

questions whether the respondent has proceeded without, or in excess of, jurisdiction;

whether there was a fair trial; and whether there was any prejudicial abuse of discretion.

Abuse of discretion is established if the respondent has not proceeded in the manner

required by law, the order or decision is not supported by the findings, or the findings are

not supported by the evidence." (Code Civ. Proc., § 1094.5, subd. (b); Fukuda v. City of

Angels (1999) 20 Cal.4th 805, 810.)

An administrative decision is considered quasi-adjudicatory when the decision is

"made as a result of a proceeding in which by law (1) a hearing is required, (2) evidence

is required to be taken, and (3) discretion in the determination of facts is vested in the

inferior board." (Eureka Teachers Assn. v. Board of Education (1988) 199 Cal.App.3d

353, 361.)

"As a general matter, an 'administrative action is quasi-legislative' when the

'administrative agency is creating a new rule for future application . . . .' " (20th Century

Ins. Co. v. Garamendi (1994) 8 Cal.4th 216, 275.) "By contrast, an 'administrative action

8
is . . . quasi-adjudicative' when the 'administrative agency . . . is applying an existing

rule to existing facts.' " (Ibid.) "[T]he distinction between the quasi-legislative and

quasi-judicial decision contemplates the function performed rather than the area of

performance; the breadth or narrowness of the discretion cannot control." (Pitts v.

Perluss (1962) 58 Cal.2d 824, 834.)

With these legal standards in mind, we consider the function performed by the

District within the applicable statutory framework. The Legislature authorized the

creation of charter schools when it enacted the Charter Schools Act of 1992. (United

Teachers of Los Angeles v. Los Angeles Unified School Dist. (2012) 54 Cal.4th 504, 521

(United Teachers).) "The charter school legislation sought to encourage educational

innovation by creating schools that would be 'free from most state laws pertaining

uniquely to school districts.' [Citation.] At the same time, 'charter schools are strictly

creatures of statute. From how charter schools come into being, to who attends and who

can teach, to how they are governed and structured, to funding, accountability and

evaluation—the Legislature has plotted all aspects of their existence.' " (Ibid.)

The Legislature created the rules that apply to the process for establishing a new

charter school, as detailed in section 47605. "The first step, set forth in subdivision (a), is

submission to the governing board of a school district a petition signed either by 'a

number of parents or legal guardians of pupils that is equivalent to at least one-half of the

number of pupils that the charter school estimates will enroll in the school for its first

year of operation' or by 'a number of teachers that is equivalent to at least one-half of the

number of teachers that the charter school estimates will be employed at the school

9
during its first year of operation.' (§ 47605, subd. (a)(1)(A) & (B).)" (United Teachers,

supra, 54 Cal.4th at p. 521.) "The petition 'shall include a prominent statement that a

signature on the petition means that the parent or legal guardian is meaningfully

interested in having his or her child or ward attend the charter school, or in the case of a

teacher's signature, means that the teacher is meaningfully interested in teaching at the

charter school. The proposed charter shall be attached to the petition.' [Citation.]" (Id. at

p. 522.)

When a governing board of a school district receives a petition that clears the

signature threshold, it must hold a public hearing "on the provisions of the charter" within

30 days of receiving the petition. (§ 47605, subd. (b).) Then, following review of the

petition and the public hearing, the board must either grant or deny the petition within 60

days of receiving the petition, subject to mutually agreeable extensions. (Ibid.)

"The governing board of the school district shall grant a charter for the operation

of a school under this part if it is satisfied that granting the charter is consistent with

sound educational practice. The governing board of the school district shall not deny a

petition for the establishment of a charter school unless it makes written factual findings,

specific to the particular petition, setting forth specific facts to support one or more" of

six specific findings listed in section 47605, subdivision (b).

A school district may grant a charter for a period not to exceed five years.

(§ 47607, subd. (a)(1).) During that period, the governing board may revoke the charter

if it finds, through a showing of substantial evidence, that the charter school failed to

perform as evidenced by one of four specific violations or failures. (Id., subd. (c)(1).)

10
Before revocation, the board must notify the charter school of any violation, provide a

reasonable opportunity to remedy the violation, unless it finds the violation to constitute a

severe and imminent threat to the health or safety of pupils (id., subd. (d)), and thereafter

"hold a public hearing . . . on the issue of whether evidence exists to revoke the charter."

(Id., subd. (e).)

At the end of the initial charter period, the school must seek renewal of its petition

for an additional five-year period if it wishes to continue to operate. (§ 47607, subd. (a).)

The renewal petition is governed by the same standards that apply to the original petition,

but the governing board must consider "pupil academic achievement for all groups of

pupils served by the charter school as the most important factor in determining whether to

grant a charter renewal." (Id., subd. (a)(3)(A).) The charter school must demonstrate it

meets one of the five alternative tests for showing pupil academic achievement is

satisfactory. (Id., subd. (b)(1)-(5).)

When considering a renewal petition, the governing board "shall consider the past

performance of the school's academics, finances, and operation in evaluating the

likelihood of future success, along with future plans for improvement if any." (Cal. Code

Regs., tit. 5, § 11966.4, subd. (b)(1).) The board may deny a renewal petition only if it

"makes written factual findings, specific to the particular petition, setting forth specific

facts to support one or more of the grounds for denial set forth in Education Code section

47605[, subdivision ](b) or facts to support a failure to meet one of the criteria set forth in

Education Code section 47607[, subdivision ](b)." (Id., subd. (b)(2).) If the board fails to

11
act on the petition within 60 days of receipt, the renewal petition is deemed approved.

(Id., subd. (c).)

Considering these procedures as a whole, we believe the trial court erred in finding

the District's decision to be quasi-legislative. When reviewing the Academy's renewal

petition, the District applied standards set by existing state law and regulations to the

facts presented in the petition and gathered by the District itself. It held a public hearing

to gauge community support, allowed speakers to make their case, and then made

specific factual findings regarding the Academy's ability to operate the charter school

successfully. The District's board then passed a 62-page resolution detailing the specific

evidence supporting each of its factual findings, which in turn, supported its ultimate

decision to deny the renewal petition. Although the District was required to consider its

overarching public policy goals in reaching its decision, it was not crafting a new policy

to be applied in future cases.

To argue to the contrary, the District asks this court to follow the reasoning of

California School Boards Assn. v. State Bd. of Education (2015) 240 Cal.App.4th 838

(CSBA), to conclude that a decision concerning the renewal of a charter school is quasi-

legislative rather than quasi-judicial. In CSBA, the appellate court considered the

standards that apply to a decision by the State Board of Education concerning whether to

grant or deny an initial application for a "state charter school" pursuant to Education

Code section 47605.8. (CSBA, at p. 842.) That decision, however, is entirely

distinguishable for two important reasons.

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 First, the issue in CSBA was whether a decision on an initial charter school

petition is quasi-legislative, whereas this case involves a decision on a petition to renew a

charter school application. Even if we assume that CSBA correctly decided that a

decision on an initial charter petition is quasi-legislative, an issue not presented in this

case, a school district's decision on a renewal petition is fundamentally different. As

discussed ante, a governing board reviewing a renewal petition "shall consider the past

performance of the school's academics, finances, and operation in evaluating the

likelihood of future success, along with future plans for improvement if any." (Cal. Code

Regs., tit. 5, § 11966.4, subd. (b)(1).) The school's past pupil academic achievement is

the "most important factor in determining whether to grant a charter renewal" and the

board must apply one of five alternative tests to adjudge whether the past performance is

satisfactory. (Ed. Code, § 47607, subds. (a)(3)(A), (b)(1)-(5).) In other words, whereas

an initial petition must necessarily involve a prospective evaluation, a renewal petition is

focused in large part on a retrospective evaluation, considering evidence of the school's

past performance against objective standards to determine whether the school is likely to

succeed in the future. This determination is quintessentially adjudicatory in nature and

distinct from the decision under review in CSBA.

Second, the decision in CSBA is distinguishable because it involved a decision by

the State Board of Education concerning a statewide charter school, whereas the issue in

this case concerns a decision by a governing board of a local school district on a local

charter school. Although the process to establish a state charter school shares many

similarities with the procedure for a local charter school, the procedures are not identical.

13
Indeed, the court in CSBA noted these differences, explaining that whereas the State

Board of Education must deny a statewide charter application unless it makes certain

findings, a school district must grant a charter application unless it makes certain

findings. (CSBA, supra, 240 Cal.App.4th at p. 853.) The petitioner in CSBA relied on

this distinction to argue that even if decisions on local charter school applications are

quasi-legislative—a question not in dispute in CSBA—decisions on state charter school

applications alone are adjudicatory because they entail a more rigorous factfinding

requirement. (Ibid.) The court, however, rejected this contention, "because the

factfinding required before a school district can deny a charter school application is far

more detailed and rigorous than the general finding required to be made by the Board

before approving a state charter." (Id. at p. 853.) The CSBA court ultimately found that

because these procedural differences could be interpreted to equally support different

conclusions, there was little to draw from comparing state and local charter school

decisions as a basis to conclude whether those decisions are adjudicatory or legislative.

Similarly, we decline to rely on the CSBA court's decision regarding state charter school

decisions as a basis to conclude local decisions are identically legislative in nature.

Given these differences, our holding that a decision of a school district regarding a

charter school renewal petition is quasi-judicial does not conflict with the holding of

CSBA that the State Board of Education makes a quasi-legislative decision when it

considers a petition to establish a state charter school.

Even setting aside these distinctions, we are not persuaded by the reasoning of

CSBA. The court first relies on the general principle that the creation and alteration of

14
municipalities and local districts are fundamentally legislative decisions. Thus, because a

charter school is " 'deemed to be a "school district" ' " for funding purposes, "the approval

of a charter school creates a school district and, like the creation of any other district, is a

quasi-legislative act." (CSBA, supra, 240 Cal.App.4th at p. 846.)

Simply because certain funding allocations concerning school districts imposed by

the state constitution and statutes also apply to charter schools does not logically lead to

the conclusion that a charter school is a school district. As amicus curiae California

Charter Schools Association notes in a brief filed in this appeal, section 47610 exempts

charter schools from nearly all laws governing school districts. The applicable statutes

that govern the establishment of a charter school discuss establishing that school within

the school district, not as a school district. (See id., subd. (a)(1).) Although there is some

overlap in funding mechanisms, a charter school is not a school district.

The court in CSBA next cites the general principle that "the hallmark of a quasi-

legislative decision is that the agency's determination is informed by public policy, that

is, how the decision will affect the interests of the community." (CSBA, supra, 240

Cal.App.4th at p. 847.) The court applied that principle to conclude the approval of a

charter school petition "is a quintessentially quasi-legislative action" because the decision

"should include consideration of the charter's effects on local school districts and should

take into account public concerns regarding the proposed charter and its conditions of

approval." (Id. at p. 848.)

However, this analysis ignores the fundamental focus in distinguishing between

quasi-legislative and quasi-judicial actions on " 'the nature of the function performed.' "

15
(CSBA, supra, 240 Cal.App.4th at p. 847.) Simply because a public agency considers

public policy and the effect on a community when making a decision does not turn a

quasi-judicial function into a quasi-legislative function. Indeed, courts themselves often

grapple with public policy and the effect of decisions on the community when making

judicial decisions.

When considering a petition to establish or renew a charter school, the district's

governing board must, and should, consider public policy. But in considering the

petition, the board is performing the function of adjudging whether the charter school's

past performance and future plans fulfill the statutory requirements for the renewal of a

charter school as set forth in state law. The state Legislature created the policies that

apply to a charter school renewal petition; it is not a matter left within the quasi-

legislative discretion of local school districts. A local district governing board cannot

deny a renewal petition simply because it finds that the continued operation of the charter

school would adversely impact the community as a whole. Instead, it may deny a

renewal petition only by making at least one of several specific factual findings defined

by state law. (Cal. Code Regs., tit. 5, § 11966.4, subd. (b)(2).) Although the board

should be guided by fundamental principles of public policy, those principles are not the

dominant concern under the applicable legal framework.

As guided by the relevant statutes, the District's board was performing a quasi-

judicial action when it considered the evidence presented by the Academy in its renewal

petition, conducted a public hearing, and then issued detailed findings to support its

conclusion that the Academy failed to meet the legal standards for a renewal of their

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charter. Accordingly, the trial court was required to consider the Academy's writ petition

pursuant to the procedures and standards applicable to administrative mandamus

proceedings under section 1094.5 of the Code of Civil Procedure. (See, e.g., American

Indian Model Schools v. Oakland Unified School Dist. (2014) 227 Cal.App.4th 258, 294-

295 [administrative mandamus procedures apply to judicial proceeding involving charter

revocation decision].)

By erroneously determining the District's decision was a quasi-legislative action,

the trial court applied an incorrect standard of review. Courts generally review an

agency's quasi-legislative action with deference to the expertise of the agency. (Shapell

Industries, Inc. v. Governing Board (1991) 1 Cal.App.4th 218, 230.) The trial court does

not reweigh the evidence and "confines itself to a determination whether the agency's

action has been " ' " 'arbitrary, capricious, or entirely lacking in evidentiary

support. . . .' " ' " (Ibid.) Administrative proceedings that are quasi-judicial in character

are reviewed under a less deferential standard, which requires the reviewing trial court to

determine whether the agency's findings are supported by evidence. (Id. at p. 231.)

In this action, the trial court did not expressly consider whether the District's

factual findings were supported by evidence, but rather simply concluded that the

District's decision was not arbitrary or capricious. Accordingly, we conclude the trial

court erred in denying the Academy's writ petition.

III. The Nature of the Academy's Right to Continue Operation of Its Charter School

The District contends that even if we conclude the trial court erred in construing

the District's acts as quasi-legislative, that error was not prejudicial such that reversal is

17
not warranted. It asserts that this court may independently review the administrative

record to determine whether the District's findings are supported by sufficient evidence to

affirm the denial of the Academy's writ petition.

As the District acknowledges, this contention requires resolution of an underlying

question concerning the proper scope of judicial review in this particular circumstance.

Depending on the nature of the Academy's right involved in the District's decision to not

renew its charter, this court conducts either a review of the District's decision to

determine whether it was supported by substantial evidence or a review of the trial

court's decision to determine whether it is supported by substantial evidence. The

District's argument of harmless error relies on its belief that this court may independently

examine the administrative record to review the District's decision for substantial

evidence as a basis for bypassing any evidentiary review by the trial court. As discussed

post, we disagree with the District and conclude that given the nature of the Academy's

right involved in the District's decision to not renew its charter, we cannot reach the

merits and instead must reverse and remand to the trial court for reconsideration under

the proper standard of review.

As discussed ante, section 1094.5 of the Code of Civil Procedure governs judicial

review of an adjudicatory administrative decision. The scope of judicial review,

however, requires the court to decide which of two standards of review applies. "A trial

court's review of an administrative decision is subject to two possible standards

depending on the nature of the right involved." (SP Star Enterprises, Inc. v. City of Los

Angeles (2009) 173 Cal.App.4th 459, 468.)

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 "If the administrative decision substantially affects a fundamental vested right, the

trial court must exercise its independent judgment on the evidence. [Citations.] The trial

court must not only examine the administrative record for errors of law, but must also

conduct an independent review of the entire record to determine whether the weight of

the evidence supports the administrative findings. [Citation.] If, on the other hand, the

administrative decision neither involves nor substantially affects a fundamental vested

right, the trial court's review is limited to determining whether the administrative findings

are supported by substantial evidence." (Wences v. City of Los Angeles (2009) 177

Cal.App.4th 305, 313 (Wences).)

This distinction arises from the separation of powers doctrine. As our Supreme

Court explained, the "development of a huge administrative bureaucracy" with quasi-

adjudicative powers was met with suspicion and fear by the courts that "the burgeoning

bureaucracy would endanger the prevailing concepts of individual rights." (Bixby v.

Pierno (1971) 4 Cal.3d 130, 142 (Bixby).) Accordingly, courts determined that

deprivation of these individual rights by an agency cannot be shielded from judicial

protection. "By carefully scrutinizing administrative decisions which substantially affect

vested, fundamental rights, the courts of California have undertaken to protect such

rights, and particularly the right to practice one's trade or profession, from untoward

intrusions by the massive apparatus of government. If the decision of an administrative

agency will substantially affect such a right, the trial court not only examines the

administrative record for errors of law but also exercises its independent judgment upon

the evidence disclosed in a limited trial de novo." (Id. at p. 143, fns. omitted.)

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 "The courts must decide on a case-by-case basis whether an administrative

decision or class of decisions substantially affects fundamental vested rights and thus

requires independent judicial review." (Bixby, supra, 4 Cal.3d at p. 144.) In this

analysis, courts must "consider the nature of the right of the individual: whether it is a

fundamental and basic one, which will suffer substantial interference by the action of the

administrative agency, and, if it is such a fundamental right, whether it is possessed by,

and vested in, the individual or merely sought by him. In the latter case, since the

administrative agency must engage in the delicate task of determining whether the

individual qualifies for the sought right, the courts have deferred to the administrative

expertise of the agency. If, however, the right has been acquired by the individual, and if

the right is fundamental, the courts have held the loss of it is sufficiently vital to the

individual to compel a full and independent review. The abrogation of the right is too

important to the individual to relegate it to exclusive administrative extinction." (Ibid.)

A right is fundamental "on either or both of two bases: (1) the character and

quality of its economic aspect; (2) the character and quality of its human aspect."

(Interstate Brands v. Unemployment Ins. Appeals Bd. (1980) 26 Cal.3d 770, 780.) "The

ultimate question in each case is whether the affected right is deemed to be of sufficient

significance to preclude its extinction or abridgement by a body lacking judicial power."

(Id. at p. 779, fn. 5.)

Here, the District's decision to not renew the Academy's charter had the practical

effect of closing the school. In that sense, it is indistinguishable from administrative

decisions involving the revocation of a professional license or business permit, which

20
courts have consistently held to affect a fundamental right. (See, e.g., Coe v. City of San

Diego (2016) 3 Cal.App.5th 772, 787 [decision to revoke business permit]; Goat Hill

Tavern v. City of Costa Mesa (1992) 6 Cal.App.4th 1519, 1529 (Goat Hill) [decision

affecting a business owner's "right to continue operating an established business in which

he has made a substantial investment"]; San Benito Foods v. Veneman (1996) 50

Cal.App.4th 1889, 1897 [suspension of food processing license constituted a fundamental

vested right because license "was crucial to plaintiff's economic viability as a food

processor"].)

The Academy's right to operate its charter school was also vested. The charter

school had been open and operating since 2010. The legal requirement that the Academy

seek renewal of its charter every five years does not mean the right to operate the charter

school was not vested. In Anton v. San Antonio Community Hospital (1977) 19 Cal.3d

802 (Anton), the Supreme Court rejected a similar argument in a case involving the

nonrenewal of a physician's hospital privileges. (Id. at pp. 823-824, superseded by statute

on other grounds as noted in Fahlen v. Sutter Central Valley Hospitals (2014) 58 Cal.4th

655, 678, fn. 11.)

In Anton, the hospital argued that "the right to medical staff membership and

associated privileges cannot be considered vested for more than the term of the

appointment, and that upon expiration of the term the physician becomes comparable to

an applicant for a license or franchise and wholly without a vested right to

reappointment." (Anton, supra, 19 Cal.3d at p. 824.) The court rejected this argument

for multiple reasons, most significantly on "consideration that a hospital board, through

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its act of initially admitting a physician to medical staff membership, has thereby, in the

exercise of its discretion, necessarily determined his fitness for such membership at the

time of admission and granted him the full rights of membership. The fact that review of

this appointment is made mandatory on an annual or biennial basis (through a statutory

requirement of reappointment at that interval, as determined by the hospital's bylaws) can

by no means be said to render it probationary or tentative in effect. [Citation.] In short,

the full rights of staff membership vest upon appointment, subject to divestment upon

periodic review only after a showing of adequate cause for such divestment in a

proceeding consistent with minimal due process requirements." (Id. at pp. 824-825, fn.

omitted; see Goat Hill, supra, 6 Cal.App.4th at pp. 1519, 1526 [decision to not renew a

business's permit involves a vested right because it " 'affects a right which has been

legitimately acquired or is otherwise vested' "].)

The same analysis applies here. The Academy's right to continue operating its

charter school vested upon the District's approval of its initial charter petition, and the

fact that review of the charter occurred every five years through a statutory requirement

did not render it a temporary right. As discussed ante, the District could revoke or

decline to renew the charter only after holding a hearing, considering the evidence, and

making specific factual findings. Absent such findings, the charter renewed

automatically. (Cal. Code Regs., tit. 5, § 11966.4, subd. (c).)

Accordingly, we conclude that a school district's decision to deny a charter school

renewal petition substantially affects a fundamental vested right and, thus, requires

independent judicial review.

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 The trial court, however, did not provide independent judicial review.3

Accordingly, judicial review at the appellate level is precluded. When the trial court is

required to exercise its independent judgment on the evidence, we review the trial court's

decision to determine whether its determination is supported by substantial evidence.

(Wences, supra, 177 Cal.App.4th at pp. 305, 318.) In making that determination, we

must resolve all conflicts and indulge all reasonable inferences in favor of the party who

prevailed in the trial court. (Ibid.; citing Barber v. Long Beach Civil Service Com. (1996)

45 Cal.App.4th 652, 659-660.)

The trial court's failure to apply the proper standard of review precludes this court

from reaching the merits of the appeal. The matter, therefore, must be remanded to the

trial court for reconsideration under the proper standard of review. (Wences, supra, 177

Cal.App.4th at p. 318.)

3 The Academy suggests in its briefs that the trial court opined it would have found
the District's factual findings to be insufficient to warrant nonrenewal of the charter. The
trial court's comments, however, were not a thorough and considered application of the
independent judgment standard. We therefore decline to give these comments any
credence. (See, e.g., Saraswati v. County of San Diego (2011) 202 Cal.App.4th 917, 929,
fn. 8.)
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 DISPOSITION

The judgment is reversed and the matter remanded to the trial court with directions

to reconsider the Academy's writ petition under the independent judgment standard of

review. The Academy is entitled to recover its costs on appeal.

HUFFMAN, Acting P. J.

WE CONCUR:

AARON, J.

DATO, J.

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