Filed 9/27/19 Mushtaq v. Umpqua Bank CA1/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION TWO

RAMONA MUSHTAQ,

Plaintiff and Appellant,

v.

UMPQUA BANK,

Defendant and Respondent.

A154835

(Marin County

Super. Ct. No. CV1601471)

Prior to his death, Vernon Bradley acted as attorney for plaintiff Ramona Mushtaq. Bradley had a number of accounts with defendant Umpqua Bank (the Bank). Mushtaq may have been present when one of these accounts was opened by Bradley in 2012, but her name does not appear on the relevant documents. Thereafter, Mushtaq made periodic deposits, eventually totaling $20,000, into what we will refer to as “the account.”

In May 2013, pursuant to an “Order to Withhold” from the Franchise Tax Board (FTB), the Bank removed approximately $17,374 (plus a $125 “levy fee”) from the account and delivered it to the FTB. Additional money withdrawn from another account in Bradley’s name is not at issue here. The Bank advised Bradley he had ten days to object before the money was transmitted to the FTB. Bradley did not respond within the ten days, but five months later protested the FTB “taking the money from what appears to be [a] personal account which was in fact a trust account.”

In April 2016, Mushtaq sued the Bank (and Bradley’s estate), alleging five causes of action based on the Bank’s compliance with the FTB withholding order. In due course, the Bank moved for summary judgment on a number of grounds but primarily argued its actions enjoyed immunity under Revenue and Taxation Code section 18674, subdivision (a) (section 18674(a)). Concluding that “section 18674 provides a complete defense to the action in its entirety,” the trial court granted the motion, and Mushtaq filed a notice of appeal from the order.

An order granting a motion for summary judgment is not appealable, but the merits of the order can be reviewed on appeal from a final judgment if one is entered. (E.g., Lackner v. LaCroix (1979) 25 Cal.3d 747, 753; Johnson v. Alameda County Medical Center (2012) 205 Cal.App.4th 521, 531.) Here, the register of actions in the clerk’s transcript recites that a judgment was subsequently signed and entered. In accordance with the principle that a notice of appeal is to be liberally construed in favor of its sufficiency, we will treat Mushtaq’s notice of appeal as perfecting a valid appeal from the judgment. (Cal. Rules of Court, rules 8.100(a)(2), 8.104(d)(2).)

Occasionally the Legislature enacts a measure whose language is so clear that the statute applies itself. So it is with section 18674(a), which is a broadly worded declaration of rights and responsibilities. The subdivision provides in pertinent part: “Any . . . person required to withhold and transmit any amount pursuant to this article [governing the income tax] shall comply with the requirement without resort to any legal or equitable action in a court of law or equity. Any . . . person paying to the Franchise Tax Board any amount required by it to be withheld is not liable therefor to the person from whom withheld unless the amount withheld is refunded to the withholding agent. However, if a depository institution [such as the Bank] . . . withholds and pays to the Franchise Tax Board pursuant to this article any moneys held in a deposit account in which the delinquent taxpayer and another person or persons have an interest, or in an account held in the name of a third party or parties in which the delinquent taxpayer is ultimately determined to have no interest, the depository institution paying those moneys to the Franchise Tax Board is not liable therefor to any of the persons who have an interest in the account, unless the amount withheld is refunded to the withholding agent.” (Italics added.)

Two familiar rules of statutory construction apply here. The first is that reviewing courts do not construe statutes in isolation, but “ ‘ “with reference to the entire scheme of law of which it is part so that the whole may be harmonized and retain effectiveness.” ’ ” (In re Marriage of Harris (2004) 34 Cal.4th 210, 222, italics added.) The scheme under consideration here is taxation. “It is essential to the performance of governmental functions that an orderly system of . . . collection of taxes shall be maintained . . . .” (Universal Cons. Oil Co. v. Byram (1944) 25 Cal.2d 353, 362; accord, Plaza Hollister Ltd. Partnership v. County of San Benito (1999) 72 Cal.App.4th 1, 31.) To that end, the state Constitution forbids any and all “legal or equitable process” that would interfere with or disrupt “the collection of any tax.” (Cal. Const., art. XIII, § 32.)

Section 18674(a) is an integral part of a comprehensive system. It follows a number of statutes establishing that any person who fails to transmit money to the FTB after receiving a withholding order is liable for those amounts. (§§ 18668, subd. (a), 18670, subd. (a), 18672, 18673.) Immediately behind it is section 18675 which sets out a taxpayer’s remedies in response to a withholding order believed to be unjustified or wrongful. The United States Supreme Court characterized the withholding procedure as “unequivocal” in that “it creates an absolute legal obligation to make payment,” and “no defense is permitted.” (Franchise Tax Bd. of Cal. v. U.S. Postal Service (1984) 467 U.S. 512, 522–523.)

Given the importance of the subject, the Legislature obviously sought to allay any fears of persons or entities that they could face personal liability for obeying an FTB withholding order. The sole reported California opinion appearing in the “Notes of Decisions” for section 18674 in the West’s Annotated Code (vol. 61 (2015 ed.) foll. § 18674, p. 171) is Kanarek v. Davidson (1978) 85 Cal.App.3d 341 (Kanarek). The Court of Appeal began by noting “It is settled that summary administrative procedures for the collection of . . . income tax assessments are not violative of due process.” (Id. at p. 345.) The court then stated that “one having funds belonging to a taxpayer and who is served with a notice to hold and remit must do so despite conflicting claims to the funds.” (Id. at p. 346, italics added.) If the person complies with this “duty” (id. at p. 345), that person “cannot be held liable for damages under section 1983 of the federal Civil Rights Act in transmitting the funds to the Franchise Tax Board.” (Id. at p. 346.)

In her opening brief, Mushtaq sees this as “a case of first impression” because there were “competing orders”—her being under a court order to make monthly deposits into the account, while the Bank complied with the FTB’s “Order to Withhold.” Mushtaq is literally correct; Kanarek does not address the precise situation presented here, so any variation of the circumstances would qualify as “a case of first impression.” On the other hand, the court in Kanarek was considering a situation where there were “conflicting claims to the funds” (Kanarek v. Davidson, supra, 85 Cal.App.3d at p. 346), which certainly seems to describe the setting here. Mushtaq does not mention Kanarek in either of her briefs (nor does the Bank for that matter), so we cannot conclude she has presented a persuasive argument for declining to apply it here.

Mushtaq argues the Bank was not entitled to summary judgment because it did not establish that the FTB withholding order was superior to the court’s order. We do not agree. The summary judgment statute has been interpreted by our Supreme Court to mean that a party moving for summary judgment “bears an initial burden . . . to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden . . . he causes a shift , and the opposing party is then subjected to a burden . . . of his own to make a prima facie showing of the existence of a triable issue of material fact.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) Once the Bank made a prima facie showing of the statutory immunity, it was up to Mushtaq to prove that the immunity did not apply. In her opposition to the Bank’s summary judgment motion, Mushtaq simply dismissed the FTB order as a “red herring” of “no consequence,” intended by the Bank “to obfuscate the theft of funds.” In the ensuing discussion there is the statement that “the significance of [the Bank’s] entire ‘compliance with a levy’ fabrication is in dispute.” But there is nothing about the FTB order having a lesser importance or priority than the court’s order. Further, the orders were not literally in conflict; one required Mushtaq to set aside funds in an account, and the other required the Bank to transmit funds held in Bradley’s account to the FTB. In other short, the burden was on Mushtaq and she did not satisfy it. Moreover, plaintiff cites to no evidence that defendant knew about the court order.

Much of Mushtaq’s brief is given over to assertions of fact that are not supported with the required citations to the record on appeal. (Cal. Rules of Court, rule 8.204(a)(1)(C).) They will be disregarded. (E.g., Fierro v. Landry’s Restaurant, Inc. (2019) 32 Cal.App.5th 276, 281, fn. 5; Johnson v. Tago, Inc. (1986) 188 Cal.App.3d 507, 512, fn. 1.) So too will arguments based on the allegations of her complaint, for they are not allowed to substitute for admissible evidence. (Code Civ. Proc., § 437c, subd. (p)(2).) Arguments of counsel at the hearing on the motion are also excluded from our consideration. (Fuller v. Tucker (2000) 84 Cal.App.4th 1163, 1173 [“Argument of counsel is not evidence”].) And we certainly are not impressed with attacks on the trial court’s integrity.

One point deserves attention. It appears that before the Bank transmitted the $17,000 to the FTB, Mushtaq made a $2,500 deposit into the account, as required by the court’s order. Added to the $1 the Bank left in the account, this produced a balance of $2,501. Mushtaq pays particular attention to this amount, arguing the immunity of section 18674(a) cannot apply because this amount was not turned over to the FTB, meaning it is still hers and she can hold the Bank accountable for it. However, the Bank produced uncontradicted evidence that this money was transferred, by Bradley, to another of his accounts. Plaintiff concedes her name was not on the account’s paperwork. Bradley had the opportunity to tell the FTB that the money in the account was not his but belonged to the plaintiff. He did not do so. Given that Bradley was the holder of the account, the sole holder in the Bank’s eyes, what he did with the money was of no concern to the Bank. Whether the transfer was a wrong as between Mushtaq and Bradley was their affair, not the Bank’s.

As mentioned earlier, two principles of statutory construction resolve this appeal. The second is that “We give the language its usual and ordinary meaning, and ‘[i]f there is no ambiguity, then we presume the lawmakers meant what they said and the plain meaning of the language governs. ’ ” (Allen v. Sully-Miller Contracting Co. (2002) 28 Cal.4th 222, 227.) The language of section 18674(a) is not ambiguous on its face. There is no reported decision indicating that its language has ever caused uncertainty as to its purpose. Therefore, like the trial court, we accept that the statutory meaning is plain and that it is to be applied according to the usual and ordinary import of the language used. This rendered Mushtaq’s complaint against the Bank untenable, making summary judgment proper.

The summary judgment is affirmed.

 

STEWART, J.

We concur.

RICHMAN, Acting P.J.

MILLER, J.

Mushtaq v. Umpqua Holdings Corp. (A154835)