A city government’s recent attempt to misuse the court system to financially cripple the local police union was successfully overcome in a Los Angeles Superior Court case known as City of South Gate v. South Gate Police Officers Association. The police union survived this effort thanks in large part to the financial support of PORAC, which enabled the union to defend itself in court when its usual source of funding was temporarily cut off by vindictive political tactics of city officials.
Last year, a campaign was initiated to recall the majority faction of the South Gate City Council. The campaign, which was ultimately successful in January 2003, received support from the membership of the city’s police union, the South Gate Police Officers’ Association (“the POA”). During the recall campaign, the incumbent City Council majority was seeking ways to discourage the POA from supporting the recall, and was conducting a broad-based investigation of POA activities toward that end.
The manner in which the POA’s operations were funded at that time gave the targeted city officials a tactical opportunity in their struggle against the recall. Under the collective bargaining agreement between the city and the POA, the city had been deducting union dues from the payroll checks of the POA members, and delivering the deducted funds to the POA on a monthly basis. Exercising their raw power of possession over the deducted funds that the city seized on an improper pretext developed during its investigation of the POA, the city wrongfully impound the deducted funds.
Instead of delivering the union dues to the POA, the city deposited the funds with the clerk of the Superior Court and filed a civil complaint against the POA under the doctrine of “Interpleader.” The allegations made in the Interpleader Complaint challenged the POA’s basic right to continue functioning as the recognized bargaining representative for the city’s police officers.
Before the city’s Interpleader Complaint could be brought before the court, the recall election succeeded. Under the governance of the new officials elected in the recall, the city voluntarily dismissed the Interpleader action, and paid back the impounded funds with interest. In retrospect, the efforts of the recalled city officials illustrate a misguided attempt to use the legal doctrine of “Interpleader” for an improper purpose.
The former city officials, in their effort to seek political leverage to discourage the POA from supporting the recall, conducted a broad-based investigation of union activities. In the process, they discovered some records in the office of the California Secretary of State that, in their minds, called into question the union’s right to continue in its capacity as the officers’ recognized bargaining representative. Records dating back to the early 1980′s showed a “suspension” of the corporate status of an entity incorporated under the same name as the South Gate POA.
The city then seized on what they perceived to be a “suspension” of the union’s “corporate” status as a pretext to impound the POA’s union dues. They did this without explanation or notice to the POA, in complete disregard of the collective bargaining agreement, and without any hearing, finding or legal proceeding of any kind. For more than a month, the POA leaders were given a runaround and were unable to even find out what had been done with the funds. The POA soon began to run short of operating funds.
It only became clear what had happened to the union dues when the POA was served with a Complaint in Interpleader. The POA, short of cash, was forced to file a Demurrer to the Interpleader Complaint, to establish its right to exist and receive the dues the members paid through their payroll deductions. The financial support of PORAC helped the POA bridge this cash flow gap to fund the defense of the Interpleader action and ultimately to vindicate its legal position.
The city’s action demonstrates an abuse of the legal proceeding known as Interpleader. In its proper use, a Complaint in Interpleader is brought by a party in possession of property that is subject to competing claims of ownership, and needs judicial supervision to be able to deliver the property to the rightful owner without facing liability to the competing claimant. The party in possession of the disputed property is known as the “stakeholder.” Probably the most typical stakeholder for an Interpleader action would be a life insurance company that has issued an insurance policy covering an accidental death, where the heirs or beneficiaries are in dispute over their proper shares of the insurance proceeds. The Interpleader doctrine enables the insurance company to “deposit” the policy proceeds with the clerk of the court, and file a complaint in which the competing claimants to the policy proceeds are named as defendants. In filing a Complaint in Interpleader, the stakeholder must renounce any ownership interest in the property. The complaint asks the court to require the competing claimants to litigate and resolve their claims against each other.
A proper Interpleader Complaint seeks a final adjudication that determines the respective claimants’ rights to receive the property, and directs the stakeholder to deliver the property in accordance with the court’s determination of the entitlement of the respective claimants. Delivering the property in accordance with the court’s directions then has the effect of releasing the stakeholder from liability to any of the claimants arising from its delivery of the property to the particular claimants found entitled to it.
In this case, to state a claim in Interpleader, the city had to allege first that it had come into possession of money that it had deducted from the members’ payroll checks. To fit the Interpleader doctrine, the complaint alleged that the city had learned that the POA’s “corporate status” was “suspended,” and therefore the city was now in doubt as to whether the POA still had a right to receive members’ union dues.
As mentioned above, a stakeholder in an Interpleader action must renounce its own right of ownership of the disputed property, and allege a dispute between rival claimants to the property, other than the stakeholder itself. This means that the city had to allege that there was a dispute to the funds between the POA and some third party, other than the city itself.
To meet that requirement, the city alleged that the members themselves, from whose payroll checks the funds had been deducted, were in dispute with the POA over the POA’s right to receive the funds. In other words, the city alleged that if the POA had lost the right to receive union dues because of the “suspension” of its “corporate status,” then the individual members were entitled to have the funds returned to them.
No POA member actually joined in the city’s argument that the POA had lost its status as a bargaining representative. But a few members asserted a right to have the funds returned to them if the city would not deliver them to the POA. On that basis, the Complaint in Interpleader named as defendants the POA on one hand, and each individual member of the POA on the other. Of course, there was no real dispute: the members only wanted the money back if the city was correct about the POA having lost its union status, and thus could refuse to deliver the funds to the POA.
It is not only improper, but impossible, to use the doctrine of Interpleader under the facts of this case. In a proper use of the doctrine, the “stakeholder,” by filing the action, forces the competing claimants to litigate their claims against one another. Having renounced any ownership of the property, the stakeholder itself take a position on the merits of the competing claims.
The action rests on the assumption that the stakeholder is genuinely uncertain as to which of the claimants is entitled to the property, and thus faces a risk of liability to at least one rival claimant if it delivers the property to others. If the claimants are not truly adverse, and refuse to disagree about the right to the property, there is nothing to litigate. For example, if this action had been permitted to proceed beyond the pleading stage, and the court had ordered the members to litigate their claims against the POA, the members could have stipulated with the POA that the union dues are to be delivered to the POA, and the city could not have done anything about it. In other words, if the city officials wanted the POA’s right to receive the funds to be examined in a court of law, they could not force the POA members to carry this torch for them. And if the city wanted to argue on its own behalf that the POA’s right to the dues was questionable, it could not use the Interpleader doctrine for that purpose.
In truth, what the city officials had discovered had absolutely no tendency whatsoever to call the POA’s legitimacy as a union into question. The city’s investigation had discovered records in the Secretary of State’s office showing that a corporate license was suspended in the early 1980s for a corporate entity, which the POA had started to create, but which had never been activated. The POA had at that time taken some initial steps toward setting up a tax-exempt corporation for the purpose of engaging in some charitable activities outside its official function as a labor organization. The idea of setting up that corporation had been abandoned, and because the corporate paperwork had never been completed, the secretary of state eventually carried that entity in its records as being “suspended.” But the corporate entity was not the POA. As a labor union, the POA did not have corporate status, and did not need corporate status. After the recall, the newly elected city officials understood this basic reality. The new officials properly dismissed the Interpleader Complaint and delivered the impounded dues to the POA. But as of this writing, the POA has not been able to reinstate the payroll deduction procedure for collecting union dues, and has been forced to rely on direct payment by individual members, a far less efficient method for funding its operations.
The City’s actions in impounding the POA’s dues had no justification. The POA’s entire existence was temporarily threatened, and it is fortunate that PORAC was there to fill the financial gap. This experience demonstrates reckless conduct of city officials in misusing the legal process to attain narrow political goals. The recalled South Gate city officials apparently face problems arising from their terms in office more serious than the heavy-handed political vindictiveness demonstrated by this case. We also understand they left the city treasury in a mess, and that their replacements face an uphill financial battle in restoring the city to a satisfactory level of public service and creditworthiness. There is probably no more profound social lesson to be derived from this experience than the principle that errant and irresponsible public servants should be exposed before they can inflict this type of damage on the public.
About the authors: Michael P. Stone, esq. and Marc J. Berger, esq. are members of Michael P. Stone, PC, LDF panel attorneys of Pasadena. For further information about this case, call (626) 683-5600 or fax at (626) 683-5656.
PORAC Legal Defense Administrator Ed Fishman Testimony: Law Enforcement Use of Body Cameras.
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To whom it may concern: Let me start by saying how much I appreciate the opportunity to join the PORAC Legal Defense Fund. This is a great benefit for our membership. During the past twelve months I was fortunate to have access to the Legal Defense Fund through MPCA. Earlier this year I was both surprise, and disappointed, when realized that I needed to provide counsel to mediate pending litigation. In accessing the Legal Defense Fund I found your staff to be very professional and reassuring. The staff felt that [my representative]., would be the best ft for the situation. I would like to take the opportunity to express my appreciation for being represented by [Rick Barry]. Not only was he a good fit for the circumstances, at times it seemed as if he was the only attorney out of several involved that really had a grasp on the issues. Again, I would like to thank the PORAC staff, and know that I could not have been better served than by what was provided by [my representative].
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I have used this law firm for union related business for the last several years. It was a no brainer to call them for LDF.
- Jason Boust Sanger POA
My rep was very helpful in explaining the processes and stayed in contact throughout the ordeal.
- Linda Mendez Imperial Co Prob and Corr
I'm very pleased with the services offered by the LDF. I feel so fortunate to enjoy the benefits of having the membership. The services provided by LDF to its members is simply 110% professional, supportive, great!! LDF care for its members is reflected by the quality of Best Law Firm offered, simply the best!
- Chris Lyon Tulare Co DSA
Very thorough group of sharp/smart government concerned [attorneys]. They understood what was happening and briefed me on everything. I was very impressed.
- Christopher Walters Antioch POA
My LDF rep was very attentive, and courteous. She made every effort to keep me informed, and kept my best interests at the front of the process. I was very satisfied with my LDF rep, and the entire process.
- Allison Clark Twin Cities POA
[My representative] is the best attorney LDF has. Her attention to details, professionalism, and intelligence were off the charts. If I did not have her as a rep I would probably be out of a job. She is fair and she was honestly concerned about me, my family and my case.
- Katie Angermiller Tuolumne Co DSA
I was very satisfied with the work the LDF performed. The lawyers and clerical staff at [law firm] were all very kind, professional and they always assisted me when I called and never made me feel like I was a burden. Thank you LDF!
- Brian Schopf Elk Grove POA
Keep up the good work.
- Ronald J. Danison El Monte POA
The LDF is a tool available to me which I hope never goes away. It makes me feel that much more confident to do my job knowing LDF has my back when police work gets ugly. And it usually does..
- Marshall Henderson Vancouver Police Officers Guild
I have used LDF in 3 OIS's. Each time I have been very well taken care of. I highly recommend [ representative ] and the PORAC system. Well done and thank you.
- Rodd N. Joseph Clearlake MMA
I appreciate the fact that my representative met with me in a social setting prior to the interview, during which time she learned the facts of the case. She was prepared for the interview. She seemed to have a genuine interest in my case.
- Christopher Wells Hollister POA
My rep was great.
- Rachael Van Sloten Oakland POA
LDF is absolutely essential to help make a system that is somewhat broken work more effectively. [My Representative] is excellent and takes a great deal of time to lisen and represent.
- Stacey Bonilla San Mateo County DSA
[My Represenative] is an excellent attorney. He is very professional yet personable and I would definitely use him again. Thank you!
- Steven Moorehouse Redding POA
You guys are Great! Very professional and well informed. THANK YOU!
- Scott Muir Tracy POA
Very satisfied with the service I was given.
- James F. Beland Lake County SDA
- Keith Stiver Hayward POA
[My representative] brings a superlative reputation, a comforting and confidence building demeanor and a clear expertise to the table. In particular I appreciate her philosophy that she gives her total undivided attention to her clients during their appointments.
- Anthony Zack Vernon POA
This was the first time in my twenty-five year career that I had to use the services of my legal defense fund. My LDF Representative was extremely courteous, informative and professional.. She addressed all of my concerns and answered all of my questions. She did an overall outstanding job of representing me and handling my case. I could not have been any more pleased or satisfied with the job she did! I would definitely request her to represent me in the future if I needed representation.
- Robert Glock Oakland POA
I am always satisfied with LDF and all their representatives.
- Nancy Page Aurora PA
I didn't end up needing his service but he was awesome in what conversations we had before the matter was resolved. Very valuable - LDF!
- Jack Ellis Lompoc POA
An excellent plan. Very valuable to its members.
- Erick Gaunt Palos Verdes POA
- Gregg Palmer San Joaquin Co Corr POA
Everything was explained very well prior to my questioning. I was not worried at all during the investigation. Very professional and a great asset to its members.
- Anthony Gregori Sonoma Co Jr College P O A
Excellent work and well worth it.
- Scott King Ripon POA
[My representative] is the best LDF rep I have ever had. If I were to need an LDF rep again I would want it to be [my representative].
- Paul Figueroa Oakland POA
LDF was there when I needed them!! In this litigious world, it's nice to know LDF has GREAT lawyers on our side who look out for us!! [My Representative] is a great attorney and a person I would trust in any circumstance!!!
- Heather Fontes San Joaquin Co POA
I appreciated the thorough follow up by LDF staff. Many thanks and blessings for the work by LDF.
- Wendy Morrow Chico Public Safety Association
I had never been through an I.A. in my 21 years. I was scared and ashamed and humiliated. ( My attorney ) was excellent. He helped me through one of the worst times of my life. Had great outcome and I am grateful.
- Gilbert Garcia Oceanside POA
My attorney provided outstanding representation.
- Caitlin Collins Tiburon POA
[My representative] made himself available 7 days a week understanding that those were my needs. He was very well informed and kept me on the right track and in the right frame of mind.
- Michael Shephard Suisun City POA
LDF is a very valuable resource. I would not do this job without it.
- Sherri Coral Riverside Community College
He was very professional. I trusted him to defend and he did! I am very thankful he was here for me.
- Oliver Sansen Concord POA
In 14 years I have never had to deal with an "IA." [My representative] was wonderful & put my mind at ease throughout the entire process. Thank you!
- Dennis Leach National City POA
[My Representative] is a knowledgeable attorney and I would highly recommend him to anyone needing representation.
- Scot Hicks Humbolt County DSO
My experience was made much less stressful thanks to the LDF representation.
- Paul Spencer Santa Paula POA
[My Representative] was great!
- Omar Daza-Quiroz Oakland POA
I have had (2) two cases in which LDF represented me. Both lawyers were exceptionally professional, intelligent and caring for me. They were friendly and very helpful.
- Andrew J. Brice Santa Maria POA
As always... an excellent result.
- Diana Drummey Coronado POA
I so appreciated my LDF rep - his kindness and understanding re my case during an embarrassing and uncomfortable time - he was so caring.
- Eric White Emeryville POA
Very satisfied with the LDF services provided. Thank you.
- Anthony Russo Clark Co School District
The members of my Association are very pleased with the level of representation that PORAC has given to us. As the President I can not thank you all enough.
- Katherine Comesana Mountain View POA
Hope to never in a situation again, however, glad to know that LDF is there to help.
- Byron Kies Santa Barbara Co DSA
Everything was great!
- Ricky L. Hemphill Los Angeles School PA
[My representative] was an excellent lawyer.
- William Burdette Newport Beach PMA
26 years and I have never needed a LDF rep, but the one time you need one, it was worth the fee’s paid.”
- Adam Laird Eureka POA
Dear PORAC Legal Defense Fund, This email has been weighing on my heart and should have been sent a long time ago. However, time seems to move fast even though your life has been put on hold. I have been on administrative leave since December of 2012. In April of 2013, I was arrested for the performance of my duties. Since the administrative side this case has not been resolved, I won't be getting into specific details regarding my case. However, I will say that I never thought that my life would turned upside down by doing the job that I love, and doing it in a way that I had been trained. I have been in Law Enforcement for 10 years, and I have been paying my monthly dues all along. I never really understood how important paying dues might be for me, I just thought it was the "cost of business". After being arrested, I understood the real worth of that investment. Because of politics, my case was given the "full court press". On January 3rd of 2014, the case against me was dismissed. It took no less than 5 experts to convince the Humboldt County District Attorney's Office to request dismissal. The time, effort, and money that this case cost couldn't have been endured by me as the sole provider of a family of four. LDF was there, big time. The panel attorney's under LDF were the best in the business. In the uncertain time during the criminal process, I couldn't have imagined how much help they could be. What a relief to know that LDF had my back. I am used to defending those who can't defend themselves. That's my job. When I was defenseless, LDF and the attorneys assigned to my case were my advocates and defenders. I thank you. My criminal attorney said it best at the conclusion of my criminal case: "Adam and his family are thankful that they can now move forward. The evidence showing Sgt. Laird was innocent was overwhelming. The expert EPD hired said that the suspect was rising up when Sgt. Laird pushed him back to the ground. The two experts that the DA’s office hired said that the force was reasonable and appropriate. The defensive tactics instructor who trained Adam said he acted consistent with his training in apprehending a high risk suspect in a dangerous situation. In total, five separate police practices experts reviewed the case and unanimously said Sgt. Laird acted appropriately". "It is hard to imagine what it must be like to risk your life apprehending a known gang member only to be charged with using excessive force when the suspect stated that he did not even feel the contact at issue. It is simply bizarre that Sgt. Laird was ever charged with a crime". Thank you. My family and I will forever be grateful for your service, Sergeant Adam Laird
- Chad Sakamoto National City POA
Although this incident was unfounded, it's still stressful. My LDF rep kept me informed and kept "work" at work.
- Gary Silva East Bay Region Parks POA
Thank you for providing this service. My experience with LDF was very much to my satisfaction.
- James Beckman Miracosta College POA
Highly recommend this program for any LEO!
- Jay Garacochea Culver City POA
[My representative] not only did he do a great job but he listened to my concerns. He did not force his views or game plan and we worked well w/ each other. We agreed on a goal and achieved it.
- David Heller Yolo County DSA
The charges against me, if sustained, would have likely ended my LE career. I was rightfully exonerated on all charges. I was well represented by [My Representative] and thank him for a job well done!!
- Robert Hartman Contra Costa Co DSA
Quick response, experienced and knowledgeable attorney which assisted in every step. [My representative] kept me apprised through the process. Thank you.
- Dennis W. Ostini Lake County DSA
[My Representative] was fantastic, knowledgeable, professional and easy to talk and work with. Even though the allegations lodged have not been resolved, [My Representative] continued to communicate with me, to offer his assistance.
- Rich Stepper Montana PPA
[ My representative ] was very knowledgeable regarding dept & legal rules regarding officer involved shooting. Provided good legal advice & was very supportive.
- Brad Young Oakland POA
[My representative] is an excellent attorney and I am very happy he picks up the phone and answers my questions whenever possible.
- Jon Seabron Oceanside POA
[My Representative] was the best and if I ever need to call al lawyer again for anything, I'll be calling her.
- Jorge Garcia San Joaquin Co Corr Officers
No criticism to give. Very well.
- Alvaro Ancheta Glendora POA
I felt I was represented in a thorough and professional manner.
- Albert Contreas Imperial Co. DSA
Thank you for your services.
- Paul Barrolaza Twin Cities POA
- Kevin Hullquist Siskiyou Co. Correctional POA
[My representative] did a good job representing me. Kept me informed.
- Joseph A. Henderson Merced POA
The firm I used was very valuable to my career and kept me updated as to status of the case. Thank you!
- Brent Teasley ERS/Reno PSAEA
[ My representative ] was bogged down with multiple cases when he represented me, but I feel he did an excellent job. I would not have wanted anyone else to represent me during a very troublesome time.
- Jeff Griffin Downey POA
My experience with the LDF, and in particular my attorney, was extremely positive. [ My attorney ] worked very hard and kept me informed along the way.
- William Jackson Santa Maria POA
Keep up the great work.
- Grace Castro AFGE Local 2455 – Laredo, TX
My representative was very kind and showed he cared when explaining what my legal rights were when dealing with an internal investigation.
- Paul Hernandez LA Gen Services POA Inc.
[My Representative] was very helpful in my situation and I can't thank him enough.
- Michelle Foerder Pinole PEA
I thank God for the support of LDF and my attorney. I had a letter of intent to be fired and he helped me turn it all around. I still have my job and I'm so grateful.