Are Injunctions Stayed on Appeal? Cal. Supreme Court Says Issue Is "Ripe for Reexamination"

The California Supreme Court in *Daly v. San Bernardino County Board of Supervisors* (Aug. 9, 2021) ___ Cal.5th ___ has decided one particular area of the law is unclear and needs "reexamination." When a trial court grants an injunction, and the injunction is appealed, does the injunction still apply during the appeal?

When the Board of Supervisors of San Bernardino violated open-meeting requirements in removing and replacing one of its members, the challenger and a citizen group filed suit and obtained an injunction requiring the Board to rescind the appointment and seat a replacement pursuant to the county charter.

But the Board was not done yet. Hoping to keep the incumbent in office long enough for the upcoming election (see this interesting coverage), the Board appealed, and under Code of Civil Procedure section 916, an appeal automatically stays the order on appeal. But the Court of Appeal denied the Board's petition for supersedeas to effect the stay.

The Supreme Court reversed. And its opinion is a letter to the state legislature to reconsider the appellate stay law.

Mandatory vs. Prohibitory Injunctions:

Why did the Court of Appeal deny the stay if the stay is automatic under section 916? The answer lies in the fact that, while the stay applies to injunctions when they are mandatory injunctions, the cases do not extend the automatic stay to merely prohibitory injunctions. The idea is that a prohibitory injunction requires no action (other than to stop doing something), and thus merely preserves the status quo. A mandatory injunction, on the other hand, requires the appellant to perform certain acts. And once the appellant has performed the act, there is no un-performing the act, and so no remedy for the Court of Appeal to fashion.

In other words, the stay of a mandatory injunction is designed to prevent an appeal from becoming moot. (I discussed this in a recent case here.)

The Supreme Court provides a good treatment of the law concerning appellate stays. The Court goes on to note that "From the start, however, courts have understood the default statutory rule governing stays pending appeal to apply to some injunctive orders but not others, embracing a common law distinction between prohibitory, or preventive, injunctions and those mandating performance of an affirmative act."

But, "Like many distinctions in the law, the distinction between a mandatory and a prohibitory injunction sometimes proves easier to state than to apply." The Court goes on to discuss common situations where injunctions apply, such as removing physical objects, employment and personnel disputes, business operations, contractual duties.

One difficulty in the analysis is: what exactly is the "status quo"? In many cases, the status quo may be defined in a way to benefit either party, depending on dating exactly when the dispute arose: if the "dispute" did not arise until after the offending activity took place, then the offending activity is part of the "status quo," and would be protected by the automatic stay. If the offending activity is itself the dispute, then the activity does not fall under the stay, and must cease despite the appeal.

As the Court put it: This "naturally raises the question where the proper baseline should be fixed. Should courts measure the status quo from the time the order is entered, as [one line of cases] hold, or instead from the “ ‘last actual peaceable, uncontested status which preceded the pending controversy’ ” ([United Railroads v. Superior Court (1916) 172 Cal.2d 189] at p. 87)?"

Here, plaintiffs urged the status quo was before the Board of Supervisors improperly seated the replacement, and thus the injunction was merely prohibitory. But the Court disagreed. "The order on appeal here required the Board not to refrain from repeating its Brown Act violation, but rather to take affirmative action to undo the violation's effect, that is, to rescind Rowe's appointment and to seat another in her place."

The Court's Call for Legislative Review:

With the ominous preface that "[n]either party has asked us to eliminate or revise the automatic stay rule," the Court went on to state: "We nevertheless pause briefly here to reflect on this area of our procedural law, which we have not addressed in many years, and to suggest an area that may be ripe for reexamination." The Court offers the following comments:

• Given how long appeals take, a "plaintiff may, in some cases, be significantly injured by the maintenance of the status quo, an automatic stay will not always be fair...." So "There is reason to doubt a strict application of the rule automatically staying mandatory injunctions will produce the most just result in all cases."
• Instead, the Court suggests: "A more flexible approach that permitted the trial and appellate courts to weigh the likelihood of each party's success on appeal and the extent of irreparable injury each will suffer from the stay decision...."
• It would "seem to make sense for both trial and appellate courts to have the same authority to order, when justice demands it, that a mandatory injunction take effect notwithstanding the filing of an appeal from the injunctive order."

The Court reiterates that it is not imposing a new standard, because "[t]his issue is beyond the scope of the questions presented" in the appeal. "But the Legislature may always, if it chooses, reexamine California's statutory law governing stays pending appeal...."

Reversed. The mandatory injunction is stayed pending appeal.