City of Dinuba v. County of Tulare

In City of Dinuba v. County of Tulare (2007) 41 Cal.4th 859, the City of Dinuba sued Tulare County after that county distributed less property tax revenue to Dinuba's redevelopment agency than the agency was statutorily entitled to receive. (Dinuba, supra, 41 Cal.4th at p. 862.) Tulare County claimed it was immune from suit under the Government Claims Act3 (Gov. Code, 810 et seq.). (Dinuba, supra, at p. 863.) The Supreme Court disagreed. It gave two reasons for its holding. First, although the Government Claims Act immunizes a public agency from liability for "an injury" caused by an erroneous interpretation or application of "any law relating to a tax" (Gov. Code, 860.2), it also defines " 'injury' " as a harm "of such nature that it would be actionable if inflicted by a private person" (Gov. Code, 810.8). Tulare County's erroneous tax distribution did not fit this description because "the wrong plaintiffs complain of 'is one which by its very nature could not exist in an action between private persons ... .' " (Dinuba, supra, 41 Cal.4th at p. 867.) Second, "the immunity provisions of the Government Claims Act are only concerned with shielding public entities from having to pay money damages for torts." (Dinuba, supra, 41 Cal.4th at p. 867.) Government Code section 814 provides that "liability based on contract or the right to obtain relief other than money damages is unaffected by" the immunity provisions of the Government Claims Act. (Dinuba, supra, at p. 867.) The Supreme Court reasoned that Dinuba did not "seek damages; it sought only to compel Tulare County to perform its express statutory duty. While compliance with the duty may result in the payment of money, that is distinct from seeking damages." (Ibid.) As an example of the kind of remedy that probably would be excluded by the Government Claims Act as damages, the court mentioned "compensatory damages for a downgraded bond rating or increased interest rates as a result of Tulare County's failure to disburse the funds to which Dinuba was entitled ... ." (Dinuba, supra, at p. 868.)