In Daneshmand v. City of San Juan Capistrano, ordered published February 16, 2021, the Fourth District Court of Appeal, Division 3 affirmed judgment in favor of the defendant city. In a prior lawsuit, the trial and appellate court ruled that tiered water rates in effect February 1, 2010 through June 30, 2014 were not proportional to the cost of providing water service. On June 16, 2015, the city approved a water rate fee refund program under which ratepayers who paid more than the water rate within their class between August 28, 2013 and June 30, 2014 would receive a partial refund of their rate. In exchange, the recipient signed a release of further refund claims against the city. A first claim for damages by plaintiffs was served on the city September 30, 2015, and a second on December 4, 2015. The claims were denied as untimely and not within the refund program. The parties stipulated to a bench trial to determine whether the one-year claim presentation deadline in Government Code section 911.2 and the statute of limitations barred the plaintiffs' claims. The court determined the claims were untimely, barring the plaintiffs' claims.
The appellate court ruled that the trial court's findings that the claims were untimely was supported by substantial evidence. Because a claim for damages from overpayment ordinarily commences when the overpayment is made, the one-year deadline for the claims started running on the due date for the last invoice reflecting the water rates--August 19, 2014. The deadline for the claims was therefore August 19, 2015. The claims were presented after that date. Although the plaintiffs raised the issue of equitable tolling on appeal, they forfeited the issue by not raising it in the trial court. The city did not waive the one-year claim deadline by allowing ratepayers to participate in the refund program until October 1, 2015, or by approving individual claims that were presented without participating in the program. Waiver requires either an actual intention to relinquish a right, or conduct so inconsistent with any intent to enforce the right as to induce a reasonable belief that it has been relinquished. Substantial evidence supported the trial court's conclusion that the city did not intend to relinquish its right to bar late claims that were outside the refund program; its stated intent in initiating the program was to "do the right thing." The city did not act inconsistently with its rights; it approved claims only to the extent they sought a refund for overcharges during the same period covered by the refund program (August 2013 through June 2014) and denied claims that sought refunds outside that period. By initiating the refund program, the city extended the time to seek refunds in exchange for the waiver of further claims; when it received individual claims after the October 1, 2015 cutoff, it rejected them as untimely. The trial court correctly determined that the refund program did not reopen the time to present claims, because it was separate from the standard process by which claims were served and resolved.