In McLeod v. Vista Unified School Dist., (— Cal.Rptr.3d —, 2008 WL 115812, Cal.App. 4 Dist., Jan. 14, 2008), a California Court of Appeal considered a trial court’s dismissal of an action challenging a school district’s expenditure of bond money, ruling that a 60-day statute of limitations applied rendering the challenge untimely.
The appellate court affirmed, finding that the 60-day statute of limitations was applicable.
Facts
In 2002, voters in the Vista Unified School District (“District”) approved a $140 million school bond to repair and renovate existing schools and build new schools. The measure outlined several specific projects to be funded. In April 2004, however, the District’s board of trustees (“Board”), citing increasing costs and changing demographics, voted to remove funding for two elementary schools and a temporary school and use that money instead to meet unforeseen cost increases for a magnet high school.
In May 2005, thirteen months after the Board’s action, Jerry and Ann McLeod (“McLeods”) sued the District under Code of Civil Procedure Section 526a, which provides for “taxpayer waste” actions, and Education Code Section 15284, which allows “school bond waste” actions. The trial court dismissed the case for untimeliness, ruling that the 60-day statute of limitations in Code of Civil Procedure sections 860 and 863 for challenging government actions applied. This type of lawsuit is commonly referred to as a “reverse validation” action. The McLeods appealed.
Decision
The McLeods’ argued that there was no applicable statute of limitations because sections 526a and 15284 do not contain statute of limitations. The Court of Appeal disagreed citing Embarcadero Mun. Improvement Dist. v. County of Santa Barbara (2001) 88 Cal.App.4th 781, which held: “The gravamen of the complaint and the nature of the right sued upon, rather than the form of the action or relief demanded, determine which statute of limitations applies.”
The Court of Appeal reasoned that the McLeods were challenging the validity of the District’s decision to change the way it spent its bond funds. Therefore, it was a “reverse validation” action subject to the 60-day statute of limitations found in sections 860 and 863.
Since the McLeods had not filed suit to challenge the District’s action within 60 days of the Board’s action, their challenge was untimely. The trial court’s ruling was affirmed.