San Diegans For Open Government v. Public Facilities Financing Authority of the City of San Diego

A citizens’ taxpayer organization sued to invalidate

certain contracts allegedly made in violation of Government

Code section 1090. The question is whether Government Code

section 1092 gives plaintiff the statutory standing to do so. We

hold that section 10921 does not provide plaintiff a private right

of action because it was not a party to the contracts. The Court

of Appeal’s judgment to the contrary is reversed. The matter is

remanded for further proceedings.

I. BACKGROUND

Under section 1090, government officials and employees

cannot be financially interested in any contract made by them

in their official capacity or by any body of which they are a

member. The statute codifies the long-standing common law

rule prohibiting public officials from having personal financial

interests in contracts they form in their official capacities.

(Lexin v. Superior Court (2010) 47 Cal.4th 1050, 1072.) Both the

common law and section 1090 “recognize ‘[t]he truism that a

person cannot serve two masters simultaneously.’ ” (Lexin, at p.

1073, quoting Thomson v. Call (1985) 38 Cal.3d 633, 637



1 All unspecified statutory references are to the

Government Code.

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(Thomson); see also San Diego v. S. D. & L. A. R. R. Co. (1872)

44 Cal. 106, 113.) Section 1090 has a broad reach, prohibiting

both direct and indirect financial interests in public contracts.

(See Moody v. Shuffleton (1928) 203 Cal. 100, 103-105.) The

penalty for a violation is substantial: The interested official

must disgorge any profits earned, and may not recover any

consideration paid, under the contract. (Thomson, at pp. 646-

652.)

Section 1092 provides that any contract made in violation

of section 1090 “may be avoided at the instance of any party

except the officer interested therein.” (§ 1092, subd. (a).) The

dispute here revolves around the meaning of the phrase “any

party.” Some background will provide context.

In 2007, the City of San Diego issued bonds to finance the

construction of Petco Park. In 2015, the City sought to refinance

the remaining debt on those bonds. It adopted an ordinance and

its Public Facilities Financing Authority (PFFA) passed a

resolution authorizing the issuance of new bonds to accomplish

the refinancing.

2

Shortly thereafter, San Diegans for Open

Government (plaintiff) sued the City and PFFA (collectively,

defendants), asserting that aspects of the refinancing

transaction violated section 1090 because at least one member

of the financing team, which included both city employees and

private organizations, had a financial “interest in one or more

contracts for the sale of the 2015 Bonds.” Plaintiff claimed it

was seeking relief “under Code of Civil Procedure Sections 860



2 PFFA is a joint powers authority that was originally

established by the City and its redevelopment agency to assist

in the financing of public capital improvements.

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et seq. and 1060 et seq.” The complaint asserted a single cause

of action, alleging that the bond issuance violated provisions of

the California Constitution, the City’s charter and municipal

code, and section 1090. Plaintiff sought a judgment declaring

the bond transaction’s approval unlawful and an injunction

prohibiting defendants from acting to further the bond issuance.

Plaintiff ultimately agreed to entry of judgment as to all

allegations except the section 1090 violation. Defendants then

argued that plaintiff lacked standing as to that issue, citing San

Bernardino County v. Superior Court (2015) 239 Cal.App.4th

679 (San Bernardino). Plaintiff argued it had standing under

section 1092 and Code of Civil Procedure section 526a.3

Plaintiff

also mentioned it had timely filed its action under the validation

statutes. (Code Civ. Proc., § 860 et seq.) The trial court ruled

for defendants, concluding that section 1092 only confers

standing on the parties to a challenged contract, and that

plaintiff also lacked standing under Code of Civil Procedure

section 526a. The remaining action was dismissed.



3 Code of Civil Procedure section 526a permits certain

individuals and corporations to sue “to obtain a judgment,

restraining and preventing any illegal expenditure of, waste of,

or injury to” a local agency’s funds or property. (Code Civ. Proc.,

§ 526a, subd. (a); see also Weatherford v. City of San Rafael

(2017) 2 Cal.5th 1241, 1245 (Weatherford).) The “primary

purpose” of the statute “is to ‘enable a large body of the citizenry

to challenge governmental action which would otherwise go

unchallenged in the courts because of the standing

requirement.’ [Citation.]” (Blair v. Pitchess (1971) 5 Cal.3d 258,

267-268.)

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Plaintiff appealed. In the Court of Appeal, the parties

agreed that Code of Civil Procedure section 863 did not provide

plaintiff an independent right of action to assert a section 1090

violation.

4

As to whether plaintiff could proceed under Code of

Civil Procedure section 526a, plaintiff argued that it could,

while defendants argued subdivision (b) of that provision barred

plaintiff’s claims for relief.5



The Court of Appeal held that the term “party” in section

1092 means “any litigant with an interest in the subject contract

sufficient to support standing,” and that plaintiff possessed such

an interest. (San Diegans for Open Government v. Public

Facilities Financing Authority of City of San Diego (2017) 16

Cal.App.5th 1273, 1284 (San Diegans).) Because it found

plaintiff could pursue its claim under section 1092, it did not

decide whether plaintiff could proceed under Code of Civil

Procedure section 526a. (San Diegans, at p. 1285, fn. 4.)



4 The parties presented no argument here on whether or

how Code of Civil Procedure section 863 might apply to this

action. We express no opinion on the matter.

5 Subdivision (b) of Code of Civil Procedure section 526a

prohibits the granting of an injunction “restraining the offering

for sale, sale, or issuance of any municipal bonds” for public

improvements or facilities. Defendants asserted this

subdivision barred plaintiff from proceeding under Code of Civil

Procedure section 526a because, if plaintiff obtained the relief it

sought, the effect would be to enjoin the bond issuance.

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II. DISCUSSION

A. General Rules Regarding Standing and Causes of

Action

“Unlike the federal Constitution, our state Constitution

has no case or controversy requirement imposing an

independent jurisdictional limitation on our standing doctrine.”

(Weatherford, supra, 2 Cal.5th at pp. 1247-1248.) Typically, to

have standing, a plaintiff must plead an actual justiciable

controversy and have some “special interest to be served or some

particular right to be preserved or protected over and above the

interest held in common with the public at large.” (Carsten v.

Psychology Examining Com. (1980) 27 Cal.3d 793, 796.) This

requirement has been relaxed in some contexts. For example,

California courts have consistently held that taxpayers have

standing to prevent illegal conduct by public officials despite the

lack of a special interest or right distinct from that belonging to

the general public. (See e.g., Weatherford, at p. 1248; Crowe v.

Boyle (1920) 184 Cal. 117, 152; Mock v. City of Santa Rosa (1899)

126 Cal. 330, 345.)

Though standing requirements are construed more

liberally in litigation enforcing public rights, a plaintiff suing

under a particular statute still must show that it is among those

with “a statutory right to relief.” (Weatherford, supra, 2 Cal.5th

at p. 1248.) Here, the question is whether plaintiff has a cause

of action creating a right to relief under section 1092. “Whether

a statute gives rise to a private right of action is a question of

legislative intent.” (County of San Diego v. State of California

(2008) 164 Cal.App.4th 580, 609; see also Boorstein v. CBS

Interactive, Inc. (2013) 222 Cal.App.4th 456, 466.) The intent

may be express or implied (Lu v. Hawaiian Gardens Casino, Inc.

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(2010) 50 Cal.4th 592, 597 (Lu)), but either way “the Legislature

must clearly manifest an intent to create a private cause of

action under [the] statute” (id. at p. 601, fn. 6, citing MoradiShalal v. Fireman’s Fund Ins. Companies (1988) 46 Cal.3d 287,

295). The burden of persuasion is with the party claiming a

statutory right to sue. (Lu, at p. 601.)

B. Plaintiff Cannot Sue Under Section 1092

Section 1092 provides in relevant part that “[e]very

contract made in violation of any of the provisions of Section

1090 may be avoided at the instance of any party except the

officer interested therein.” (§ 1092, subd. (a).) Defendants argue

the phrase “any party” includes only parties to the challenged

contract. Plaintiff argues the phrase applies more broadly to

embrace other interested persons and organizations like itself.

The Court of Appeal agreed with plaintiff. It reasoned

that the “important policy embodied in section 1090 . . . will not

be vindicated if public officials believe section 1090’s substantive

provisions may only be enforced by the very public officials or

public entities who have violated the statute’s provisions.” (San

Diegans, supra, 16 Cal.App.5th at pp. 1283-1284.) “[A] public

official’s duty to avoid even temptation cannot be advanced by

adopting a rule which limits civil enforcement to that public

official or public entities controlled by the official.” (Id. at p.

1284.) The court also found that the “weight of authority” stood

for the proposition that “standing to assert section 1090 claims

goes beyond the parties to a public contract.” (Ibid.)6

Based on



6

In support of this conclusion, the Court of Appeal cited

Thomson, supra, 38 Cal.3d 633, Stigall v. City of Taft (1962) 58

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“that authority and the important and strict policy embodied in

section 1090,” the court interpreted “section 1092’s reference to

‘any party’ to include any litigant with an interest in the subject

contract sufficient to support standing.” (San Diegans, at p.

1284.) This would include, according to the court, parties with

interests sufficient to support standing under Code of Civil

Procedure sections 526a and 863. (San Diegans, at p. 1285.)

We read the statute differently. “We begin with the text

of the statute as the best indicator of legislative intent.” (Tonya

M. v. Superior Court (2007) 42 Cal.4th 836, 844.) The statute

refers to a “contract made in violation” of section 1090, then

provides that any such contract “may be avoided by any party

except the officer interested therein.” (§ 1092, subd. (a).) The

most natural reading of this language is that the phrase “any

party” refers back to the contract; that is, any party to the

contract can sue to avoid it. The use of the word avoid in section

1092 also supports this construction. Typically, we speak of a

party to a contract avoiding its legal obligations thereunder.

(See e.g., Rest.2d Contracts, § 7 [“[a] voidable contract is one

where one or more parties have the power . . . to avoid the legal

relations created by the contract”].) Indeed, the Restatement

Second of Contracts notes that “[a]voidance is often referred to

as ‘disaffirmance.’ ” (Rest.2d Contracts, § 7, com. b, p. 20.) A



Cal.2d 565 (Stigall), California Taxpayers Action Network v.

Taber Construction, Inc. (2017) 12 Cal.App.5th 115 (California

Taxpayers), McGee v. Balfour Beatty Construction, LLC (2016)

247 Cal.App.4th 235 (McGee), Davis v. Fresno Unified School

Dist. (2015) 237 Cal.App.4th 261 (Davis), Gilbane Building Co.

v. Superior Court (2014) 223 Cal.App.4th 1527 (Gilbane),

Finnegan v. Schrader (2001) 91 Cal.App.4th 572 (Finnegan),

and Terry v. Bender (1956) 143 Cal.App.2d 198 (Terry).

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non-party does not possess the power to affirm or disaffirm a

contract. (Ibid. [“[u]sually the power to avoid is confined to one

party to the contract, but [under certain circumstances] the

contract may be voidable by either one of the parties”].)

This conclusion finds further support in provisions of the

Civil Code governing the formation and interpretation of

contracts. (See Smith v. Fair Employment & Housing Com.

(1996) 12 Cal.4th 1143, 1156 [reviewing the “Legislature’s use

of the words ‘marital status’ ” in the Family and Probate Codes

to determine the meaning of that word in a Government Code

provision]; see also Pesce v. Dept. Alcoholic Bev. Control (1958)

51 Cal.2d 310, 312; Picayune Rancheria of Chukchansi Indians

v. Brown (2014) 229 Cal.App.4th 1416, 1428.) Civil Code section

1559, for example, provides that a “contract, made expressly for

the benefit of a third person, may be enforced by him at any time

before the parties thereto rescind it.” (Italics added.) In this

provision, the Legislature uses the term “party” to refer to a

contractual party,7 as distinguished from a “person,” who is not

a contractual party.8

The careful usage of these terms in the



7 See also Civil Code sections 1558 [“[i]t is essential to the

validity of a contract . . . that the parties should exist [and] that

it should be possible to identify them,” italics added]; 1636 [“[a]

contract must be so interpreted as to give effect to the mutual

intention of the parties as it existed at the time of contracting,”

italics added]; 1689, subd. (a) [“[a] contract may be rescinded if

all the parties thereto consent,” italics added].

8 See also Civil Code sections 1556 [“[a]ll persons are

capable of contracting, except minors, persons of unsound mind,

and persons deprived of civil rights,” italics added]; 1586 [“[a]

proposal may be revoked at any time before its acceptance is

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Civil Code indicates that, when the Legislature uses the term

“party” in a statute referencing a contract, it typically means a

party to that contract.

The San Bernardino court construed section 1092 in this

fashion. There, two taxpayer groups attempted to rely on

section 1092 and Code of Civil Procedure section 526a to avoid

a settlement agreement between a county and a partnership

after a supervisor who voted in support pled guilty to accepting

bribes. (San Bernardino, supra, 239 Cal.App.4th at p. 683.) The

trial court overruled the defendants’ demurrer, which argued

that the plaintiffs lacked standing. (Ibid.) The Court of Appeal

reversed. Rejecting the plaintiffs’ argument that they were

entitled to sue under section 1092, the court reasoned that

nothing in the statute’s plain language “grants nonparties to the

contract . . . the right to sue on behalf of a public entity that may

bring a claim as provided in section 1092.” (San Bernardino, at

p. 684.) Indeed, “the Legislature’s choice of the word ‘party’ in

section 1092—as opposed to, say, ‘person’—suggests the

Legislature intended only parties to the contract at issue

normally to have the right to sue to avoid contracts made in

violation of section 1090.” (Ibid.)

Plaintiff argues the term “party” in section 1092 should be

read to include persons who are not parties to the challenged

contract. Plaintiff argues section 1092’s exception, which

prohibits “the officer interested therein” from suing to avoid a



communicated to the proposer, but not afterwards,” italics

added]; 1670.7 [declaring void any contract that “purports to

allow a deduction from a person’s wages” for emigration and

transportation costs, italics added].

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contract (§ 1092, subd. (a)), supports its construction. Because

the agency, not the officer, would normally be the party to the

contract, there would have been no reason according to plaintiff

for the Legislature to create this exception unless the term

“party” includes those who are not parties to the contract.

This argument is easily rejected. To be sure, on the

government’s side, the public agency typically would be the

contractual party. But the financially interested officer could of

course be one of the other parties to a challenged contract. In

County of Shasta v. Moody (1928) 90 Cal.App. 519, for example,

the defendant owned a printing business and was also a county

supervisor. While the defendant held that public office, “he did

printing, advertising, job work and sold supplies to . . . various

county officials of the county of Shasta, including the board of

supervisors,” and was paid for that work. (Moody, at p. 520.) In

other words, the county was one party to the contract that

allegedly violated section 1090, and the financially interested

officer was the other party to that contract. (See also Berka v.

Woodward (1899) 125 Cal. 119, 121.) The exception prohibiting

suit by an interested officer would prevent that officer from

suing on his or her own behalf, as a contractual party, to avoid

the contract. Thus, the phrase “any party” need not be read to

include nonparties in order for that exception to make sense.

Plaintiff also argues the term “party” could be read to

include a party to litigation concerning the contract. Plaintiff

points out that, in the article of the Government Code in which

sections 1090 and 1092 are found,9

the word “party” is followed



9 Sections 1090 and 1092 are in article 4 of chapter 1 of

division 4 of title 1 of the Government Code.

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by the qualifier “to any proceeding” on one occasion (§ 1091.4,

subd. (b)) and by the qualifier “to litigation” on another (§ 1091,

subd. (b)(15)). Plaintiff urges that the use of these qualifiers

shows the term “party” has a broader meaning in this context

and includes persons other than the contractual parties.10



These textual arguments fall short. As mentioned, the

sentence in which the phrase “any party” appears begins by

referencing a “contract made in violation” of section 1090.

(§ 1092, subd. (a).) The word “party” may not be directly

adjacent to the qualifiers set out above, but it is most natural to

read that word as referring back to the contract mentioned at

the beginning of the sentence. Indeed, the Legislature may have

thought it unnecessary to qualify the term “party” in section

1092, subdivision (a), because that subdivision already

references a contract made in violation of section 1090. To add

the qualifier “contracting” to the phrase “any party” in section

1092 arguably would have been redundant.

In any event, the ultimate question is whether the

Legislature has clearly manifested an intent to create a private

right of action. (Lu, supra, 50 Cal.4th at p. 601, fn. 6.) If the



10 The concurring and dissenting opinion makes a similar

point. It notes that the word “party” appears in this article 35

times; that, in 32 of those instances, the word is directly

preceded or followed by the qualifiers “contracting,” “to the

contract,” or “to a contract”; that, in two of those instances, the

word is followed by the qualifiers “to any proceeding” and “to

litigation”; and that, “[o]nly in section 1092 does the word ‘party’

appear without any qualifier.” (Conc. & dis. opn., post, at p. 7;

see also id. at p. 7, fn. 5.) Thus, it is fair to infer “that the

Legislature intended for the word ‘party’ within section 1092 to

encompass more than a ‘contracting party.’ ” (Id. at p. 7.)

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Legislature has clearly expressed an intent one way or the other,

“that usually ends the inquiry.” (Animal Legal Defense Fund v.

Mendes (2008) 160 Cal.App.4th 136, 142.) If it has “expressed

no intent on the matter either way, . . . there is no private right

of action [citation], with the possible exception that compelling

reasons of public policy might require judicial recognition of

such a right.” (Ibid., citing Moradi-Shalal v. Fireman’s Fund

Ins. Companies, supra, 46 Cal.3d at pp. 304-305.)

Here, the Legislature has clearly expressed an intent that

parties to public contracts may sue to avoid those contracts

under section 1092. As to nonparties, however, there is no such

clear expression of intent.11

Accordingly, we cannot find that

plaintiff has a private right of action unless there are compelling

policy reasons to do so. Those reasons do not exist here. The

Court of Appeal based its interpretation of section 1092 on both

case law and the necessity of vindicating the policies embodied

in section 1090. Neither reason compels us to read an intent

into the statute that does not appear on its face.

1. The Case Law

None of the cases cited by the Court of Appeal addressed

the precise issue presented: Whether a nonparty taxpayer can



11 Moreover, as noted, the Legislature has prohibited

injunctions restraining municipal bond offerings, sales, and

issuances. (Code Civ. Proc., § 526a, subd. (b).) There appear to

be sound policy reasons underlying that prohibition. (Cf.

McLeod v. Vista Unified School Dist. (2008) 158 Cal.App.4th

1156, 1167-1168.) Construing section 1092 to permit nonparties

to sue to avoid contracts for section 1090 violations would

effectively provide an end-run around the Legislature’s bar on

claims seeking to enjoin municipal bond issuances.

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sue under section 1092 to avoid a government contract on

conflict-of-interest grounds. The case law has been less than

clear in discussing the distinction between standing and causes

of action. Although a number of cases cited by both parties

purport to address a taxpayer’s “standing” to enforce section

1090, these cases ultimately address whether a taxpayer had a

cause of action under either Code of Civil Procedure section 526a

or section 1092. In Terry, supra, 143 Cal.App.2d 198, for

example, the plaintiff brought a taxpayer action under Code of

Civil Procedure section 526a, alleging a city’s payment of a

warrant would violate section 1090. (Terry, at pp. 201, 206-207.)

The Court of Appeal did not discuss whether the plaintiff could

sue under section 1092. Instead it ruled that Code of Civil

Procedure section 526a provided “express statutory

authorization to maintain [the] action.” (Terry, at p. 208.)

Similarly, in Gilbane, supra, 223 Cal.App.4th 1527, the

plaintiff sued under Code of Civil Procedure section 526a

alleging that contracts between a school district and certain

construction companies violated section 1090. (Gilbane, at p.

1530.) The Court of Appeal found the plaintiff had

“associational standing” under Code of Civil Procedure section

526a, and did not discuss whether section 1092 authorized the

plaintiff to sue. (Gilbane, at p. 1531.) Terry and Gilbane thus

stand for the proposition that a nonparty taxpayer can invoke

the substantive prohibitions of section 1090 in an action

authorized by Code of Civil Procedure section 526a. They do

not, however, support the conclusion that a nonparty taxpayer

can sue to avoid a public contract under section 1092.

Neither do Stigall, Thomson, and Finnegan. In Stigall,

supra, 58 Cal.2d 565, this court did not address whether the

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plaintiff could sue under section 1092. We simply noted that the

plaintiff taxpayer sought a declaration that a plumbing contract

was invalid under section 1090 (Stigall, at pp. 566-568), and

then proceeded to the merits of the claim.12

In Thomson, supra,

38 Cal.3d 633, the question was “what remedies are available

once a section 1090 violation is found and the fully performed

underlying contract is adjudged void.” (Thomson, at p. 638.) It

had already been determined in an earlier suit that the contract

violated section 1090. (Thomson, at pp. 637-638.) Thus, we

were not called upon in Thomson to determine whether the

plaintiff could sue under section 1092.

13



In Davis, supra, 237 Cal.App.4th 261, the Court of Appeal

concluded that a taxpayer had alleged facts sufficient to state a

section 1090 claim. (Davis, at pp. 270, 271, 301.) The court also

opined that “[t]he term ‘any party’ [in section 1092] is not

restricted to parties to the contract.” (Id. at p. 297, fn. 20.) That

statement was dictum; as the court noted, the defendants had

not challenged the plaintiff’s “standing to bring the conflict of



12 Like Stigall, Finnegan involved a “taxpayer’s suit” seeking

a declaration that a government contract violated section 1090.

(Finnegan, supra, 91 Cal.App.4th at p. 575.) The court did not

address the question of standing. Nor did it address whether

the plaintiff was authorized to bring his suit under section 1092.

13 The concurring and dissenting opinion argues that

“Thomson . . . shows that a nonparty can seek to avoid the terms

of a contract.” (Conc. & dis. opn., post, p. 6.) But our analysis

in Thomson, supra, 38 Cal.3d 633 did not expressly rely on the

operation or application of section 1092. We do not dispute that

a taxpayer can invoke the conflict-of-interest rule in section

1090 to challenge a public contract. The question is whether he

or she may do so under section 1092, and Thomson provides no

answer.

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interest claim under . . . section 1090.” (Ibid.) Thus, Davis also

does not support the conclusion that a nonparty taxpayer can

sue under section 1092.

That leaves McGee and California Taxpayers. In McGee,

supra, 247 Cal.App.4th 235, a taxpayer sued claiming that an

agreement between a school district and a construction company

violated a number of statutes, including section 1090. (McGee,

at p. 239.) A demurrer was sustained in part on the ground the

plaintiff lacked standing. (Id. at p. 246.) The Court of Appeal

reversed, holding the plaintiffs had alleged a cause of action for

a section 1090 violation. (McGee, at p. 246.) It did not mention

section 1092. While McGee supports the conclusion that a

taxpayer can assert a section 1090 violation, it does not hold that

the plaintiff can sue under section 1092.

Like McGee, California Taxpayers, supra, 12 Cal.App.5th

115, involved a reverse validation claim that an agreement

between a school district and a construction company violated

section 1090 and other statutes. (California Taxpayers, at pp.

123-124.) The result was similar as well. The Court of Appeal

reversed an order sustaining a demurrer as to the section 1090

claim. (California Taxpayers, at pp. 122, 145.) The court took

note of San Bernardino, supra, 239 Cal.App.4th 679, but

reasoned that Gilbane, Davis, and McGee “ha[d] recognized that

an action under . . . section 1090 may be brought by a taxpayer.”

(California Taxpayers, at p. 141.) As explained, none of those

cases addressed whether a nonparty taxpayer can sue under

section 1092. California Taxpayers does not do so either.

In summary, there seems to be no dispute that a nonparty

taxpayer whose action meets the requirements of Code of Civil

Procedure section 526a can sue under that section alleging a

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government contract violates section 1090. (See, e.g., Terry,

supra, 143 Cal.App.2d 198; Gilbane, supra, 223 Cal.App.4th

1527.) Additionally, some cases have assumed that a plaintiff

can invoke section 1090 without explaining the statutory

authorization for the plaintiff’s lawsuit. (See, e.g. Thomson,

supra, 38 Cal.3d 633; Stigall, supra, 58 Cal.2d 565; California

Taxpayers, supra, 12 Cal.App.5th 115; McGee, supra, 247

Cal.App.4th 235; Davis, supra, 237 Cal.App.4th 261; Finnegan,

supra, 91 Cal.App.4th 572.) But whether a plaintiff may invoke

section 1090 and whether a plaintiff may sue to avoid a contract

under section 1092 are distinct questions. None of the cases the

Court of Appeal cites support the conclusion that a nonparty

may sue under section 1092 to avoid a contract. The only case

to directly consider the question held that section 1092 did not

create a private right of action. (San Bernardino, supra, 239

Cal.App.4th at pp. 684-685.)

2. Compelling Policy Reasons

Nor is the Court of Appeal’s interpretation of section 1092

necessary to vindicate the policies embodied in section 1090.

Section 1092 is not the only vehicle for enforcing the substantive

prohibitions in section 1090. On the contrary, the conflict-ofinterest rule is backed by an array of administrative, civil, and

criminal enforcement mechanisms.

First, the Attorney General or a district attorney can

criminally prosecute a person who willfully violates section 1090

(§ 1097.1, subd. (b)) and, if convicted, that person can be

punished by a fine or by imprisonment, and is “forever

disqualified from holding any office in this state” (§ 1097, subd.

(a)). Second, the Fair Political Practices Commission (the

Commission) can bring an administrative action against any

SAN DIEGANS FOR OPEN GOVERNMENT v. PUBLIC FACILITIES

FINANCING AUTHORITY OF THE CITY OF SAN DIEGO

Opinion of the Court by Corrigan, J.

17

person who has violated section 1090. (§ 1097.1, subd. (a).) The

Commission can “investigate possible violations of Section 1090”

(§ 1097.2, subd. (a)), issue subpoenas (§ 1097.2, subd. (e)), and

hold hearings to determine if a violation occurred (§ 1097.2,

subd. (c)). The Commission may also file “a civil action for an

alleged violation of Section 1090.” (§ 1097.3, subd. (a).) If held

liable, the violator may be fined up to $10,000 or three times the

value of the financial benefit received. (Ibid.) The existence of

such a comprehensive enforcement scheme is strong evidence

the Legislature did not intend to create a private right of action

for nonparties to the contract. (See Animal Legal Defense Fund

v. Mendes, supra, 160 Cal.App.4th at pp. 143-144; Crusader Ins.

Co. v. Scottsdale Ins. Co. (1997) 54 Cal.App.4th 121, 136.)

Because violations of section 1090 can be challenged by

contractual parties under section 1092, by taxpayers under Code

of Civil Procedure section 526a where appropriate, and by the

Attorney General, district attorneys, and the Fair Political

Practices Commission, there is no compelling reason to conclude

that section 1092 creates a private right of action for nonparties

to sue to avoid public contracts.14



C. Plaintiff May Be Able To Proceed Under Code of Civil

Procedure Section 526a

Below, the parties debated whether plaintiff’s claims for

relief were permitted or barred by Code of Civil Procedure

section 526a, based on the particular facts alleged. As

mentioned, the Court of Appeal declined to address the question.



14 To the extent Holloway v. Showcase Realty Agents, Inc.

(2018) 22 Cal.App.5th 758 is inconsistent with this opinion, we

disapprove that decision.

SAN DIEGANS FOR OPEN GOVERNMENT v. PUBLIC FACILITIES

FINANCING AUTHORITY OF THE CITY OF SAN DIEGO

Opinion of the Court by Corrigan, J.

18

The parties argued each side of the issue in their briefs to

this court. Neither party disputes that Code of Civil Procedure

section 526a is, as a general rule, available to taxpayers who

wish to challenge government contracts affected by financial

conflicts of interest. We agree. (See ante, pp. 15-16.) But the

statute also prohibits the granting of an injunction “restraining

the offering for sale, sale, or issuance of any municipal bonds”

for public improvements or facilities. (Code Civ. Proc., § 526a,

subd. (b).) The parties have disagreed as to how that prohibition

applies here, given the nature of plaintiff’s request for relief.

The prayer for relief in plaintiff’s complaint indicated that it was

seeking, among other things, a judgment declaring the bond

transaction invalid. At oral argument, plaintiff suggested for

the first time that it was only seeking disgorgement of payments

received by the allegedly-conflicted officers for their role in

administering the bond issuance. The question of what

particular form of relief plaintiff is seeking, and whether such

relief is available under Code of Civil Procedure section 526a,

should be answered first by the Court of Appeal. The parties

agreed at oral argument that a remand would be the best course

of action were we to find section 1092 does not provide plaintiff

a private right of action.

SAN DIEGANS FOR OPEN GOVERNMENT v. PUBLIC FACILITIES

FINANCING AUTHORITY OF THE CITY OF SAN DIEGO

Opinion of the Court by Corrigan, J.

19

III. DISPOSITION

The Court of Appeal’s judgment is reversed. The matter

is remanded for the Court of Appeal to decide whether this

plaintiff may proceed under Code of Civil Procedure section

526a or any other statutory provision.

CORRIGAN, J.

We Concur:

CHIN, J.

LIU, J.

CUÉLLAR, J.

KRUGER, J.

GROBAN, J.

SAN DIEGANS FOR OPEN GOVERNMENT v. PUBLIC

FACILITIES FINANCING AUTHORITY OF THE CITY OF

SAN DIEGO

S245996

Concurring and Dissenting Opinion

by Chief Justice Cantil-Sakauye

The purpose of the conflict-of-interest statutes, including

Government Code sections 1090 and 1092,1

is to protect the

public. This purpose takes on special importance in the context

of municipal bonds because of the prevalent use and economic

importance of these bonds in the state of California.2

California

relies on these bonds to make capital improvements and to build

and maintain public works, each of which is “a quintessentially

public function.” (Department of Revenue of Ky. v. Davis (2008)

553 U.S. 328, 342; see Cal. Debt, supra, table 3.) Consistent

with the fact that these bonds are “the way to shoulder the

cardinal civic responsibilities [of] protecting the health, safety,

and welfare of citizens,” it is the citizenry, or taxpayers, who



1 All further statutory references are to the Government

Code unless otherwise indicated.

2 See California Debt and Investment Advisory Committee,

2018 Summary of California Public Debt Issuance (hereafter

California Debt), tables 1, 2 [as of Dec. 23, 2019]

[reporting that in 2018 California and its political subdivisions

issued approximately $62 billion in public debt, of which $50

billion was in the form of bonds]. All Internet citations in this

opinion are archived by year, docket number, and case name at

.

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Cantil-Sakauye, C. J., concurring and dissenting

2

ultimately pay for these bonds. (Department of Revenue of Ky.

v. Davis, at p. 342, fns. omitted.)

One would think, then, that municipal bond issuances

would be subject to the most exacting scrutiny — the kind of

scrutiny needed to detect and remedy conflicts of interest that

could both undermine public confidence in this crucial financing

vehicle and saddle taxpayers with large enduring financial

obligations. Yet, today’s majority opinion holds otherwise. The

majority interprets section 1092’s language providing that “any

party” may bring a judicial action to avoid a contract involving

a prohibited conflict of interest as conferring standing only upon

the parties to the very contract to be avoided. I disagree. I do

not believe the Legislature created a scheme that counts on the

foxes to guard the henhouse, and leaves taxpayers helpless to

halt even the most egregiously conflicted government bond

issuances. The likely result under the majority’s rule is that no

one will bring a challenge to avoid a government contract

afflicted with a conflict of interest. Because I do not believe

section 1092 should to be read so narrowly as to deliver this

unfortunate outcome and nothing in its language compels such

an interpretation, I respectfully dissent.

I. STANDING UNDER SECTION 1092

The question before us is one of statutory interpretation.

Section 1090 states, “Members of the Legislature, state, county,

district, judicial district, and city officers or employees shall not

be financially interested in any contract made by them in their

official capacity, or by any body or board of which they are

members.” (§ 1090, subd. (a).) Section 1092, in turn, specifies,

“Every contract made in violation of any of the provisions of

Section 1090 may be avoided at the instance of any party except

the officer interested therein.” (§ 1092, subd. (a).)

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Cantil-Sakauye, C. J., concurring and dissenting

3

In parsing the term “any party” in section 1092, we must

decide whether the term refers to only parties to the challenged

contract or whether it applies more broadly to encompass a

taxpayer group like plaintiff San Diegans for Open Government

(SDOG). If the former, then only contractual parties to a

“contract made in violation of . . . Section 1090” have standing

under section 1092 to challenge the contract. (§ 1092, subd. (a).)

As with any statutory construction case, we begin “by

considering the statute’s language and structure, bearing in

mind that our fundamental task in statutory interpretation is to

ascertain and effectuate the law’s intended purpose.”

(Weatherford v. City of San Rafael (2017) 2 Cal.5th 1241, 1246

(Weatherford).) In the context of standing, we have recognized

that although “th[e] analysis [to determine standing] is

grounded in the statutory text, the text read in isolation can be

insufficient to adequately capture . . . other . . . considerations

that have traditionally informed the outer limits of standing.”

(Id. at pp. 1248-1249.) We therefore maintain a “sensitivity to

the larger context . . . to better effectuate the Legislature’s

purpose in providing certain statutory remedies.” (Id. at

p. 1249.)

The majority holds that the term “any party” in section

1092 means “any party to the contract.” (Maj. opn., ante, at p. 7.)

I disagree. I believe the term “any party” is ambiguous and

capacious enough to reach plaintiff taxpayer group. Indeed,

when section 1092 is read in light of the statutory structure and

the imperative to “effectuate the . . . intended purpose” of the

conflicts-of-interest statutes, the term should be understood to

confer standing on interested taxpayers. (Weatherford, supra,

2 Cal.5th at p. 1246.)

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Cantil-Sakauye, C. J., concurring and dissenting

4

A. The Text of Section 1092

I begin with the text of section 1092, which, as noted,

states, “Every contract made in violation of any of the provisions

of Section 1090 may be avoided at the instance of any party

except the officer interested therein.” (§ 1092, subd. (a).) The

majority asserts that because section 1092 mentions a “contract

made in violation of . . . Section 1090,” the term “any party”

“refers back to the contract” and should be read to mean

contractual parties. (Maj. opn., ante, at p. 7.) But simply

because this is one plausible interpretation of section 1092

does not mean it is the only such interpretation.

The term “any party” is easily understood to mean a

“person” or “litigant,” a designation encompassing nonparties to

the challenged contract. (See Merriam-Webster Online Dict.

[as of

Dec. 23, 2019] [defining “party” to include “a particular

individual: person”]; Black’s Law Dict. (11th ed. 2019) p. 1350,

col. 1 [defining “party” both as “[s]omeone who takes part in a

transaction” and “[o]ne by or against whom a lawsuit is

brought”]; accord Black’s Law Dict., at p. 1695, col. 2 [defining

standing as “[a] party’s right to make a legal claim or seek

judicial enforcement of a duty or right” (italics added)].)

A number of courts, including the Court of Appeal in this

case, have reached conclusions that are consistent with this

reading. (See San Diegans for Open Government v. Public

Facilities Financing Authority of City of San Diego (2017)

16 Cal.App.5th 1273, 1280-1283, 1284-1285 (San Diegans)

[discussing these cases]; Davis v. Fresno Unified School Dist.

(2015) 237 Cal.App.4th 261, 297, fn. 20 [“The term ‘any party’ is

not restricted to parties to the contract”].) The only Court of

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Cantil-Sakauye, C. J., concurring and dissenting

5

Appeal to have adopted a more constrained construction is San

Bernardino County v. Superior Court (2015) 239 Cal.App.4th

679. The majority opinion approves of San Bernardino,

contending that its interpretation of section 1092 is “[t]he most

natural.” (Maj. opn., ante, at p. 7.) Yet every Court of Appeal to

have considered San Bernardino has disagreed with it. (See

Holloway v. Showcase Realty Agents, Inc. (2018) 22 Cal.App.5th

758, 767-770 [noting that “[s]ince the time of the trial court’s

decision in the present case, a number of cases have criticized

the rationale in San Bernardino” and joining the chorus of

criticism]; San Diegans, supra, 16 Cal.App.5th at p. 1284 [“we

do not agree with the limited interpretation of section 1092

adopted by the court in San Bernardino”]; McGee v. Balfour

Beatty Construction, LLC (2016) 247 Cal.App.4th 235, 248

(McGee).) This seems to leave room for doubt concerning

whether the majority’s restrictive reading of section 1092 is, in

fact, the most reasonable.

Neither of the two remaining bases the majority musters

to support its interpretation of section 1092 entirely persuades

me either. The majority first says that because section 1092

allows a “contract made in violation . . . of Section 1090 [to] be

avoided” and “[a] nonparty does not possess the power to [avoid]

a contract,” we should infer that only contractual parties have

standing under section 1092. (Maj. opn., ante, at pp. 7-8.) But

our own case law offers a counterexample to the idea that

nonparties cannot avoid a contract.

In Thomson v. Call (1985) 38 Cal.3d 633 (Thomson), a

taxpayer group that was not a party to a government contract

successfully avoided the municipality’s responsibilities under

that contract on the basis that the agreement violated section

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Cantil-Sakauye, C. J., concurring and dissenting

6

1090.3

The facts of Thomson are as follows: a councilman (Call)

sold the City of Albany, by way of a middleman, a parcel of land

he and his wife owned. (38 Cal.3d at p. 637.) The Calls received

$258,000 from the transaction. (Id. at p. 643.) When the

transaction was found to violate section 1090, the trial court’s

solution was to allow the City of Albany “to retain the land and,

at the same time, recover the $258,000 plus interest from the

Calls.” (Thomson, at p. 646.) We recognized the “harsh[ness]”

of this remedy but ultimately approved of it, reasoning that “the

goals and policy concerns underlying section 1090” warranted

such solution. (Id. at p. 647.) Thomson thus shows that a

nonparty can seek to avoid the terms of a contract.4

In light of

such precedent, I do not see why we would be compelled to

interpret section 1092’s reference to “avoid[ance]” to mean that

only a party to the contract may seek such a remedy. (§ 1092,

subd. (a).)

The majority next looks to the “provisions of the Civil

Code” to buttress its conclusion that the term “any party” in



3 Not incidentally, this is exactly what SDOG has said it is

seeking to do in this case: unwind a bond purchase agreement

alleged to have been made in contravention of section 1090 so

the City of San Diego would be reimbursed for the costs it paid

under the agreement.

4 The majority asserts that Thomson “provides no answer”

to the ultimate question before us, whether a nonparty taxpayer

may invoke section 1092 to challenge a public contract. (Maj.

opn., ante, at p. 14, fn. 13.) In other words, Thomson is not

controlling in the present case. I do not contend that it is.

Rather, I reference Thomson to show that it is not just parties

to a contract who may sue to “avoid[] [the] legal obligations

thereunder,” and thus “[t]he use of the word avoid in section

1092” does not bear the weight the majority’s construction puts

on it. (Maj. opn., ante, at p. 7.)

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Cantil-Sakauye, C. J., concurring and dissenting

7

section 1092 means any contracting party. (Maj. opn., ante, at

p. 8.) I agree that we should look to the “ ‘structure and . . .

surrounding provisions’ ” of section 1092 to ascertain its

meaning. (Weatherford, supra, 2 Cal.5th at pp. 1246-1247.) But

it is the provisions neighboring section 1092 that are most

germane, not those from outside the Government Code.

In the article where section 1092 is found, the word “party”

appears 35 times. In all of these instances, when the Legislature

intends the word “party” to mean “contractual party,” it modifies

the word “party” with a qualifier — “contracting,” “to the

contract,” “to a contract” — that makes its intent unmistakably

clear. (See §§ 1091, subds. (b)(2), (3), (5), (6), (8), (14), (d)

[referring to “contracting party”], 1091.5, subd. (a)(4), (10)

[same], 1091, subd. (b)(10) [“party to the contract”]; § 1091.5,

subds. (a)(11), (b) [same], 1091.5, subd. (a)(14) [“party to a

contract”].)5

In short, it appears that when the Legislature

intends to refer to contracting parties, it does not simply say

“party.” Only in section 1092 does the word “party” appear

without any qualifier. It is fair to infer from the absence of any

modifying language in this context that the Legislature

intended for the word “party” within section 1092 to encompass

more than a “contracting party.”6



5

In two instances, statutes within this article refer to

“party to litigation” and “party to any proceedings.” (§§ 1091,

subd. (b)(15), 1091.4, subd. (b).)

6 The majority states that to add a qualifier “to the phrase

‘any party’ in section 1092 arguably would have been

redundant.” (Maj. opn., ante, at p. 11.) I cannot entirely

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Cantil-Sakauye, C. J., concurring and dissenting

8

In sum, read in isolation, the term “any party” in section

1092 is at least ambiguous. In my view, the term is as

susceptible to applying “broadly to embrace other interested

persons” who are not parties to a contract as it is to a more

restrictive reading. (Maj. opn., ante, at p. 6.) Any ambiguity is

removed however when I consider the purpose, policy, and aim

of section 1092.

B. The Purpose of Section 1092

Because section 1092 provides a mechanism to enforce the

rule against conflicts of interest set forth in section 1090, a few

words regarding the purpose of section 1090 are appropriate.

The goals behind section 1090 are to “eliminat[e]” financial

temptation faced by public officials, “avoid[] the appearance of

impropriety,” and “assur[e] the [municipality] of the officer’s

undivided and uncompromised allegiance.” (Thomson, supra,

38 Cal.3d at p. 648.) In light of these goals, we have said that



disagree with this carefully couched assertion, because in saying

that a qualifying addition “arguably would have been

redundant,” the majority acknowledges that it arguably would

not have been redundant. (Ibid.) Indeed, such an addition

would not have been clearly surplusage. Even the provisions

cited by the majority show that the Legislature may modify the

word “party” although the statutory language already

references a contract. (See id. at p. 8 & fn. 7.) For instance,

Civil Code section 1689 provides that “[a] contract may be

rescinded if all the parties thereto consent.” (Civ. Code, § 1689,

subd. (a), italics added; see also id., § 1559 [“[a] contract, made

expressly for the benefit of a third person, may be enforced by

him at any time before the parties thereto rescind it”].) As such,

had the Legislature wanted to, it easily could have drafted

section 1092 to read, “Every contract made in violation of any of

the provisions of Section 1090 may be avoided at the instance of

any party thereto,” without being redundant.

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FINANCING AUTHORITY OF THE CITY OF SAN DIEGO

Cantil-Sakauye, C. J., concurring and dissenting

9

section 1090 deserves “strict enforcement.” (Thomson, at

p. 650.)

The “strict enforcement” of section 1090 necessarily

depends in part on who may sue to enforce its substance.

(Thomson, supra, 38 Cal.3d at p. 650.) Simply put, however

strict the prohibitions of section 1090 are, if no one could — or

would — bring suit to vindicate its provisions, then section 1090

is a paper tiger. In the context of a different conflict-of-interest

statute (section 526a of the Code of Civil Procedure), we have

recognized the need to empower “ ‘a large body of the citizenry

to challenge governmental action which would otherwise go

unchallenged in the courts because of the standing

requirement.’ ” (Weatherford, supra, 2 Cal.5th at p. 1251.) That

same need arises in the context of section 1090, and this is where

section 1092 plays a crucial role.

Section 1092 allows “any party except the officer interested

therein” to bring suit. (§ 1092, subd. (a), italics added.) The

majority’s interpretation of section 1092 means that in

circumstances in which every party to the contract is for one

reason or another an interested government official no one will

be able to sue for avoidance under the statute. (See, e.g., People

v. Superior Court (Sahlolbei) (2017) 3 Cal.5th 230, 235, 243

[discussing a case in which the counterparty to a government

contract was an interested person because, while working for a

school district, she “advised the district to retain her consulting

company . . . , which the district did”]; California Taxpayers

Action Network v. Taber Construction, Inc. (2017) 12

Cal.App.5th 115, 145; McGee, supra, 247 Cal.App.4th at p. 249.)

Even when it is not the case that all parties to a contract

are “[m]embers of the Legislature, state, county, district,

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Cantil-Sakauye, C. J., concurring and dissenting

10

judicial district, . . . [or] city officers or employees,” such parties

may still have little incentive to unwind a transaction that they

have ratified. (§ 1090, subd. (a).) Government officials would

appear to have little financial or political motivation to sue on

behalf of the public when, by suing, the officials themselves

could be implicated for alleged collusion, delay, malfeasance, or

negligence. A private counterparty to the contract also may

have little reason to bring suit, given that it won the contract or

otherwise engaged with the public entity and so likely would not

want to disrupt the status quo, invite bad press, or rouse

suspicion that it engaged in bribery or collusion with a public

official.

In other words, I believe the court below was correct when

it said, “The strict and important policy embodied in section

1090 . . . will not be vindicated if public officials believe section

1090’s substantive provisions may only be enforced by the very

public officials or public entities who have violated the statute’s

provisions.” (San Diegans, supra, 16 Cal.App.5th at pp. 1283-

1284.) Because “a public official’s duty to avoid even temptation

cannot be advanced by adopting a rule which limits civil

enforcement to that public official or public entities controlled

by the official,” I would not adopt such a rule. (Id. at p. 1284.)

The majority recognizes the public policies that support

the decision below but maintains that “the Court of Appeal’s

interpretation of section 1092 [is not] necessary to vindicate the

policies embodied in section 1090.” (Maj. opn., ante, at p. 16.)

According to the majority, this is because there are other

mechanisms “for enforcing the substantive prohibitions in

section 1090.” (Ibid.) These are: criminal prosecutions under

section 1097, civil or administrative actions brought by the Fair

Political Practices Commission (FPPC), and civil actions “by

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Cantil-Sakauye, C. J., concurring and dissenting

11

taxpayers under Code of Civil Procedure section 526a where

appropriate.” (Maj. opn., ante, at p. 17.) In my opinion, none of

these provisions quite fills the gap left by the majority’s

construction of section 1092.

Neither the threat of criminal prosecution nor action by

the FPPC protects the public in the way that section 1092 does

— or at least, should. An official may be criminally prosecuted

only if he or she “willfully and knowingly” violates section 1090.

(People v. Chacon (2007) 40 Cal.4th 558, 570; see § 1097, subd.

(a).) This heightened mens rea requirement leaves a swath of

instances in which the official may have had an improper

interest, the public was deprived of his or her “absolute loyalty

and undivided allegiance,” and yet there is no recourse to be had

from the Attorney General or district attorney. (Stigall v. Taft

(1962) 58 Cal.2d 565, 569.)

The FPPC, meanwhile, cannot act except upon “written

authorization from the district attorney of the county in which

the alleged violation occurred.” (§ 1097.1, subd. (b).) Thus, in a

case in which the district attorney, for whatever reason,

withholds authorization, the FPPC cannot even begin “an

investigation that might lead to administrative or civil action”

against an interested official. (Ibid.) Moreover, neither the

FPPC nor criminal prosecutors can offer the public the remedy

available under section 1092: avoidance of the contract.

Although the penalties afforded in FPPC or criminal actions are

not insubstantial (see §§ 1097, subd. (a), 1097.3, subd. (a)), their

target are the officials themselves, not the resulting contracts

foisted on the public. And the public may be both less interested

in sending someone to prison than unwinding a raw deal and

less well served by a fine than by halting a bond transaction

infected with self-interest.

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Cantil-Sakauye, C. J., concurring and dissenting

12

This leaves us with Code of Civil Procedure section 526a.

An action brought under section 526a that disputes the validity

of a bond is subject to a short 60-day statute of limitations. (See

McLeod v. Vista Unified School Dist. (2008) 158 Cal.App.4th

1156, 1166-1170.) This is in contrast to the four-year statute of

limitations afforded to actions brought under Government Code

section 1092. (§ 1092, subd. (b).)

More importantly, in examining the limits of Code of Civil

Procedure section 526a, we come full circle with the importance

of bonds and the public interest. The majority refers to this

limitation, acknowledging that under subdivision (b) of section

526a “no injunction shall be granted restraining the offering for

sale, sale, or issuance of any municipal bonds for public

improvements or public utilities.” (Code Civ. Proc., § 526a,

subd. (b); see maj. opn., ante, at p. 18.)7

In other words, when

municipal bonds are at stake — precisely the instance in which

the taxpayers bear the costs of paying for the public debt —

taxpayers may not seek to “restrain[] the offering for sale, sale,

or issuance” of any of those bonds under section 526a. (Code

Civ. Proc., § 526a, subd. (b).) Yet the availability of such a

remedy is crucial. Once bonds have issued, attempts to claw

them back, rewrite their terms, or otherwise renegotiate the

issuance may prove impossible. In the absence of preemptive



7 Relying on this provision, the majority argues that

“[c]onstruing section 1092 to permit nonparties to sue to avoid

contracts for section 1090 violations would effectively provide an

end-run around the Legislature’s bar on claims seeking to enjoin

municipal bond issuances.” (Maj. opn., ante, at p. 12, fn. 11.)

Given that parties to the contract presumably could bring such

claims, however, there is no reason to think that actions seeking

injunctions on municipal bond issuances are, by necessity, the

“end-run[s]” the majority makes them out to be. (Ibid.)

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Cantil-Sakauye, C. J., concurring and dissenting

13

remedies like an injunction, self-interested governmental

dealings may well inflict costly and irreparable harm on the

public.

Put differently, today majority’s opinion holds that in

cases in which government officials make contracts that amount

to writing checks on the public’s checkbooks, the public cannot

stop them. This did not need to be the outcome. Section 1092 is

readily capable of being read as conferring standing on nonparty

taxpayer groups to bring a challenge in such circumstances.

I would read the section thusly.

Like the Court of Appeal, I believe “plaintiff taxpayers have standing under Government Code section 1092 to challenge the [City of San Diego’s] ordinance on the grounds participants in the proposed transaction violated the conflict of interest provisions of section 1090.” (San Diegans, supra, 16 Cal.App.5th at p. 1276, fn. omitted.) I therefore would affirm the judgment below. The majority today reverses and remands to the Court of Appeal “to decide whether this plaintiff may proceed under Code of Civil Procedure section 526a.” (Maj. opn., ante, at p. 19.) Although I dissent from the decision to reverse, I do not oppose a remand given the majority’s disposition.