Judge Curtis A. Kin, Case Number: 22STCP04015, Date: 2024-09-24 Tentative Ruling

Petitioner Robert Hirsh, an attorney at law with his own Beverly Hills law firm, Robert W. Hirsh & Associates (AR 825), petitions for a writ of mandate directing respondent State of California Department of Housing and Community Development to pay benefits purportedly owed under the state rental assistance program. The goal of the state rental assistance program at issue was to prevent evictions and housing instability due to the COVID-19 pandemic. (AR 6.) Guidelines for the program were enacted to ensure that “those most in need of pandemic-related rental assistance” received it. (AR 2.)

Against the backdrop of this program and its goal to assist those in need and hoping to avoid eviction and housing instability, petitioner and his family members, including two of his daughters—one, a 19-year-old freshman attending Washington University in St. Louis (AR 404) and the other, a Juris Doctor candidate attending the University of Chicago Law School (AR 187) at the time—applied for (and, in some instances, received) tens of thousands of dollars in rental assistance. (AR 748-55.) The family members claimed to be petitioner’s tenants renting rooms in petitioner’s 5-bedroom, 7-bathroom, 7,869 square foot home valued at approximately $7,645,800 (AR 181), but purportedly could not pay the thousands of dollars in monthly rent they claim he charged them. Ultimately, respondent State of California Department of Housing and Community Development denied petitioner and his family members’ requests for rental assistance on the ground that “[i]nconsistent or unverifiable information has been provided by the applicant.” (See, e.g., AR 652.)

Petitioner Robert Hirsh is the landlord of a single-family residence located at 160 South June Street in Los Angeles (“House”). (AR 621.) Petitioner purportedly leased rooms in his residence to family members William Hirsh (William), Rina Hartman (Rina), Victoria Hirsh (Victoria), Lauren Hirsh (Lauren), and Clare Hartman (Clare) (collectively, “Family Members”). The nature of the familial relationships is described further below.

Starting in September 2021, petitioner, as landlord, and Family Members, as tenants, applied for rental assistance pursuant to the COVID-19 Emergency Rental Assistance Program, administered by the Department of Housing and Community Development (“HCD”). (AR 101-23 (Lauren’s application]; 188-210 [Victoria’s application]; 280-302 [Clare’s application]; 420-42 [Rina’s application]; 615-25 [petitioner’s application]; 669-91 [William’s application].) On January 31, 2022, petitioner’s application, which purportedly incorporated all of the Family Members’ applications (Opening Br. at 3:19-22), was deemed complete. (AR 908.) Some level of rental assistance was awarded and dispersed to petitioner on behalf of certain alleged tenants. (AR 748-55 [payment logs to petitioner], 893 [approval of Lauren’s application on 10/27/21].)

For several months, starting in January 2022, HCD assessed whether petitioner and his Family Members were entitled to benefits. On January 14, 2022, petitioner sent HCD a letter to challenge the amount of benefits awarded to Lauren. (AR 825.) Lauren and Clare applied for additional benefits on January 7, 2022. (AR 769-71 [Lauren’s application log], 778-79 [Clare’s application log].) Petitioner also called HCD, on January 24, 2022, to check the status of Rina’s application, which was under review at that time. (AR 786 [Rina’s application log].) On March 30, 2022, William submitted his application for benefits. (AR 691.) HCD’s review during this period of time led it to identify information it found questionable, inconsistent, and unverified in the applications. (AR 485 [irregularity in applications first noted on February 23, 2022]; see also 759-810 [case logs for Victoria, Lauren, Clare, Rina, petitioner, and William’s applications].) Ultimately, HCD denied the applications. (AR 652, 654, 759, 768, 778, 784, 808, 813, 815-16.) The Family Members assigned all of their rights and causes of action to petitioner. (AR 887 [Rina], 891 [Clare], 890 [Victoria], 888 [Lauren], 889 [William].)

As part of the submission of an application to the Program, applicants certify their understanding that they have 30 days to appeal a decision denying benefits through the provided website link. (AR 122 [Lauren - Certifications section 7, subdivision (f)], 163 [same], 209 [Victoria], 250 [same], 301 [Clare], 342 [same], 441 [Rina], 690 [William], 731 [same].) The application instructions also direct applicants to watch for and respond to Program emails and calls. (See, e.g., AR 189 [Victoria].) Additionally, denial notices inform applicants of their appeal rights and provide guidance on how to initiate the appeal. (AR 652 [denial notice sent to petitioner].) The denial notices also supersede any prior communications to the contrary. (AR 652.)

Family Members were first notified that benefits were denied through a batch email that was sent on May 4, 2022. (AR 759 [Victoria], 768 [Lauren], 778 [Clare], 784 [Rina], 808 [William], 815-16 [HCD internal emails re: verification of receipt of denials], 851 [same].) HCD verified that the denials were emailed to the Family Members on May 4 at 21:23:23. (AR 826.) The computer program used to send the batch emails also has the ability to identify if the denial letter was opened. The computer program indicates that a denial letter was opened by Rina. (AR 814, 826.)

Responding to an email from petitioner, HCD notified him, on May 25, 2022, that the applications were denied and that his Family Members have 30 days to initiate an appeal of the denial. (AR 813.) Petitioner responded to HCD’s May 25 email. (AR 812.) This communication triggered additional efforts by HCD to provide further notice—e.g., resending the denial notices to the Family Members (AR 654), follow-up emails with petitioner (AR 654 [email dated May 26, 2022, discussing resent denial notices and appeal rights]), and a formal denial notice electronically sent to petitioner (AR 652 [formal denial notice sent to petitioner on May 31, 2022]).

The inconsistent information found by HCD, which became the basis for the denial of benefits, includes, but is not limited to:

Separate Households. The Family Members, and one more applicant,[1] applied as six separate households, purporting to lease separate, single bedrooms in the single-family residence owned by petitioner. (AR 639, 641, 643, 645 [leases for Clare, Lauren, Victoria, and Rina], 746 [William’s lease].) HCD also determined that petitioner and his wife live at the House. (AR 180 [property description identifies the House as owner occupied], 486, 656 [property report from DataTree].) This evidence suggested to HCD that the Family Members and petitioner were not separate households and that they should have been a single household when applying. (AR 485; see also AR 9 [household income is the total income of all household members above the age of 18], 16 [describing when to treat co-tenancy applicants as a single or separate households].)

Number of Purported Rooms Rented. The number of claimed tenants is inconsistent with the number of rooms in the House. (AR 348, 485.) The House has five bedrooms (AR 181 [Zillow.com description of the house], 656 [report from DataTree]), but six purported tenants renting separate rooms (AR 513, 621). HCD also determined that petitioner and his wife also live at the house (AR 820), which would further reduce the number of available rooms to rent in the House to four. Thus, the House could not support the occupancy of six tenants purportedly living as separate households each in a single room.

Familial Relationships. The purported tenants all have familial relationships with petitioner. (AR 178 [summary of findings describing relationships], 348, 485.) HCD determined: that William is petitioner’s uncle (AR 665); that Rina is petitioner’s sister-in-law (AR 412-13, 415-17, 884); that Victoria is petitioner’s daughter (AR 403, 665), who was in high school at the time the purported lease began and started attending Washington University in St. Louis after high school (AR 400-04, 643); that Lauren is petitioner’s daughter (AR 183, 665) and was enrolled in an out-of-state college during the time of the lease (AR 186-87, 641); and that Clare is petitioner’s niece (AR 665; Reply at 1:18).

Unreasonable Rent. The claimed rents for a single bedroom in the House is inconsistent with the Family Members’ claimed incomes. William’s application indicates an adjusted annual income of $18,000 (AR 685), but he purportedly entered a lease to pay his nephew $3,600 per month (AR 663, 746). Rina’s application indicates an adjusted annual income of approximately $18,380 per year while unemployed (AR 437, 501-02), but she purportedly entered a lease to pay her brother-in-law $1,500 per month (AR 413, 645). Victoria’s application indicates that she did not earn any income (AR 204) but purportedly entered into a lease to pay her father $2,200 per month (AR 401, 643), including for time when she was still in high school or attending college (AR 400-04). Lauren’s application indicates an adjusted annual income of $25,000 (AR 117), but she purportedly entered a lease to pay her father $2,200 per month (AR 109, 641), including time when she was enrolled in out-of-state colleges (AR 186-87). Clare’s application indicates an adjusted annual income of $19,382 (AR 296), but she purportedly entered a lease to pay her uncle $1,500 per month. (AR 273, 639).

Residency at the House. The applications contained inconsistent or unverified information relating to whether all of the Family Members lived at the House for the entirety of the claimed time. It was a five-bedroom house with six purported tenants, not including petitioner (the purported landlord) and his wife, claiming to rent out single, separate bedrooms. (AR 621.) Additionally, Lauren and Victoria were each enrolled in out-of-state colleges during some of the time of the claimed leases. (AR 178, 186-87 [Lauren’s LinkedIn profile indicating attendance at the University of Michigan from 2016 to 2020 and at the University of Chicago Law School from 2021 to 2024], 403-04 [Victoria’s LinkedIn profile indicating attendance at Washington University in St. Louis from 2021 to 2025].)

Questionable Documentation. HCD had concerns that the leases were only entered into to support the applications for rental assistance, rather than for the purpose of establishing actual landlord-tenant relationships, and that the Family Members were not under a true threat of eviction, as required for assistance eligibility. (AR 21-22, 345, 348-49.) The period covered by rental assistance began on April 1, 2020. (Health & Safety Code § 50897.1(d)(1); AR 6 [Program Guidelines], 42 [copy of statute].) Most of the leases were entered into near the start of the eligibility period, and the Family Members were immediately unable to pay rent once the eligibility period began, and sometimes immediately after the lease was entered into. Indeed, there is no evidence in the record that any of the Family Members ever paid rent consistent with the leases. William’s lease purportedly started on January 1, 2020. (AR 663, 746.) As discussed above, his income did not support the purported rent due, and so by April 2020, he purportedly was unable to pay his rent. (AR 691.) Similarly, Victoria’s lease started on January 1, 2020 (AR 643), while she was still a senior at Beverly Hills high school (AR 403-04). She purportedly had no income (AR 204), and so by April 2020, she was unable to pay her rent (AR 210 [Victoria’s application showing in rental arrears from April 2020]). Lauren and Clare’s leases started May 1, 2020. (AR 181, 273, 639, 641.) However, they were immediately unable to pay, and even claimed they were in arrears for April 2020. (AR 123 [Lauren’s application showing in rental arrears from April 2020], 302 [Clare’s application showing in rental arrears from April 2020].) For Rina, her lease was also inconsistent with her income, and she was immediately unable to pay her rent starting April 2020. (AR 413, 501-02, 507, 509.) Also, the Family Members include two daughters and one niece, at least two of which were either still in high school or attending college. (Reply at 1:18; AR 178, 186-87 [Lauren’s LinkedIn profile], 403-04 [Victoria’s LinkedIn profile].), which is often an age when children receive significant support from their parents, such as housing in the parents’ home. Accordingly, petitioner’s direct threat to commence eviction proceedings against his daughter, Lauren, rang hollow to HCD. (See AR 177.) Similarly, the prospect that petitioner would evict any of the Family Members from his home and then offer the room to “rent” to a third-party stranger, as would occur in an actual rental property situation, was not credible.

On November 9, 2022, petitioner filed a verified petition for writ of mandate. On December 20, 2022, petitioner filed a First Amended Petition for writ of mandate. On January 19, 2023, respondent filed an Answer to the First Amended Petition.

On June 28, 2024, petitioner filed an opening brief. On August 6, 2024, respondent filed an opposition. On August 26, 2024, petitioner filed a reply. The Court has received an electronic copy of the administrative record and a hard copy of the joint appendix.

CCP § 1085(a) provides: “A writ of mandate may be issued by any court to any inferior tribunal, corporation, board, or person, to compel the performance of an act which the law specially enjoins, as a duty resulting from an office, trust, or station, or to compel the admission of a party to the use and enjoyment of a right or office to which the party is entitled, and from which the party is unlawfully precluded by that inferior tribunal, corporation, board, or person.”

“There are two essential requirements to the issuance of a traditional writ of mandate: (1) a clear, present and usually ministerial duty on the part of the respondent, and (2) a clear, present and beneficial right on the part of the petitioner to the performance of that duty.” (California Assn. for Health Services at Home v. State Dept. of Health Services (2007) 148 Cal.App.4th 696, 704.) “An action in ordinary mandamus is proper where…the claim is that an agency has failed to act as required by law.” (Id. at 705.)

“When a party seeks review of an administrative decision pursuant to Code of Civil Procedure section 1085, judicial review is limited to examining the agency proceedings to ascertain whether the agency's action has been arbitrary, capricious or lacking entirely in evidentiary support, or whether the agency failed to follow the proper procedure and give notices required by law. And, where the case involves the interpretation of a statute or ordinance, our review of the trial court's decision is de novo.” (Ideal Boat & Camper Storage v. County of Alameda (2012) 208 Cal.App.4th 301, 311, citing Pomona Police Officers' Assn. v. City of Pomona (1997) 58 Cal.App.4th 578, 584.) In independently reviewing legal questions, “An administrative agency's interpretation does not bind judicial review but it is entitled to consideration and respect.” (Housing Partners I, Inc. v. Duncan (2012) 206 Cal.App.4th 1335, 1343.)

An agency is presumed to have regularly performed its official duties. (Evid. Code § 664.) In a CCP § 1085 writ petition, the petitioner generally bears the burden of proof. (California Correctional Peace Officers Assn. v. State Personnel Bd. (1995) 10 Cal.4th 1133, 1154.)

“In general, a party must exhaust administrative remedies before resorting to the courts.” (Coachella Valley Mosquito & Vector Control Dist. v. California Public Employment Relations Bd. (2005) 35 Cal.4th 1072, 1080.) The exhaustion doctrine “requires that a party must not only initially raise the issue in the administrative forum, but he must proceed through the entire proceeding to a final decision on the merits of the entire controversy.” (McHugh v. County of Santa Cruz (1973) 33 Cal.App.3d 533, 539.) “[E]xhaustion of the administrative remedy is a jurisdictional prerequisite to resort to the courts.” (Abelleira v. District Court of Appeal, Third Dist. (1941) 17 Cal.2d 280, 293.) “The exhaustion doctrine is principally grounded on concerns favoring administrative autonomy (i.e., courts should not interfere with an agency determination until the agency has reached a final decision) and judicial efficiency (i.e., overworked courts should decline to intervene in an administrative dispute unless absolutely necessary).” (Farmers Ins. Exchange v. Superior Court (1992) 2 Cal.4th 377, 391.) Petitioner bears the burden to establish that it exhausted administrative remedies. (Westinghouse Elec. Corp. v. County of Los Angeles (1974) 42 Cal.App.3d 32, 37.)

Respondent argues that petitioner and the Family Members did not appeal the denial of their applications for rent assistance. The Court agrees.

The Family Members were notified of the denial of their applications on May 4, 2022, at 21:23:23, by email. (AR 759 [Victoria], 768 [Lauren], 778 [Clare], 784 [Rina], 808 [William], 815-16 [HCD internal emails re: verification of receipt of denials], 851 [same], 826 [spreadsheet re: sending of denial emails to Family Members].) Only Rina opened the denial email. (AR 814, 826.) Nevertheless, when the Family Members applied, they acknowledged their understanding that they had 30 days from notice of ineligibility to appeal the decision by following the instructions at the specified website link. (AR 122 [Lauren - Certifications section 7, subdivision (f)], 163 [same], 209 [Victoria], 250 [same], 301 [Clare], 342 [same], 441 [Rina], 690 [William], 731 [same].)

On May 25, 2022, HCD notified petitioner that his application and the Family Members’ applications were all denied. (AR 813 [“We have reviewed your application and associated tenant applications and see that they were denied. Your tenants

received instructions for how to appeal this determination in their denial letter within 30 days of the notice”].) Petitioner responded to HCD’s notification on the same day, stating that “[a]ppeal letters were sent by [him] months ago” but that he never received any response. (AR 812.) HCD then resent the denial notifications the same day, to which petitioner was notified. (AR 654.) On May 31, 2022, HCD also sent an email to petitioner stating that his application was denied and that he had 30 days from the notification to request an appeal. (AR 652.)

Petitioner does not demonstrate any appeal was filed in response to the denial notifications sent in May 2022 to either him or the Family Members. Instead, petitioner argues that the Case Audit Logs for each of the Family Members indicates that no denial letters have been sent to them as of June 2022. (AR 489 [Rina], 740 [William], 759 [Victoria], 768 [Lauren], 777 [Clare].) While the Case Audit Logs state in entries dated June 2, 2022 that “[t]he denial letter has not been sent,” they also state that, on May 4, 2022, the applications were denied via bulk processing. (AR 759 [Victoria], 768 [Lauren], 778 [Clare], 784 [Rina], 808 [William].) On June 13, 2022, HCD’s Section Chief of the Emergency Rental Assistance Program asked a Supervisor to confirm that denials were sent to the Family Members because the Section Chief did not see the denial letters in the tenant files. (AR 859.) On June 17, 2022, the Supervisor confirmed that six tenant denials (i.e., the five Family Members and Betty Louza, whose application is not at issue here) were sent in the batch on May 4, 2022, “as all stamped in the audit log,” and that the denials would be uploaded to the respective files. (AR 859.) The denials were memorialized in a spreadsheet prepared by HCD. (AR 826.)

Therefore, it appears that, on June 2, 2022, when the Case Audit Logs were updated to reflect that no denial letters had been sent, the letters had not yet been uploaded to the respective Family Member files, even though denials had been sent on May 4, 2022. Therefore, the June 2, 2022 entries do not mean that the May 4, 2022 entries in the same Case Audit Logs regarding the sending of denial notices in batch processing are inaccurate.

In any event, assuming arguendo that the Family Members did not receive the denial letters, petitioner does not deny that he received a denial letter by email on May 31, 2022. (AR 652.) The letter stated that he had 30 calendar days from the notification to request an appeal and contained instructions on how to submit an appeal. (AR 652.) The denial letter also stated: “If an appeal to this denial is not received within 30 days THIS NOTICE SHALL BE CONSIDERED A “FINAL DECISION” OF THE DEPARTMENT UNDER THE COVID-19 RENTAL HOUSING RECOVERY ACT (Chapter 6 of Title 3 of Part 3 of the Code of Civil Procedure).” (AR 652; see also CCP § 1179.09(d)(1) [“final decision” includes application that is denied because tenant is not eligible for government services].) Accordingly, petitioner had 30 days from May 31, 2022 to submit an appeal for himself and the Family Members, as petitioner admitted that his application incorporated all of his Family Members’ applications. (See Opening Br. at 3:19-22.) As stated above, petitioner does not establish that he sent any appeals in response to any of the May 2022 denial letters sent to him or the Family Members.

Petitioner argues that Lauren, Rina, Victoria, and Clare sent appeals on January 14, 2022. (See AR 825 and attachments to reply.) The submissions that petitioner characterizes as appeals were submitted before the May 2022 denials. It was incumbent upon petitioner and the Family Members to request an appeal after the May 2022 denials and exhaust the available administrative proceedings after the denial letter was sent. (McHugh, 33 Cal.App.3d at 539.) No requests for appeals were submitted in response to the May 2022 denials. Because petitioner and the Family Members failed to appeal, the denial of petitioner and the Family Members’ applications are final and unreviewable.

Even if petitioner exhausted administrative remedies, petitioner does not establish that respondent abused its discretion in denying the applications of petitioner and the Family Members. Petitioner states in a conclusory fashion that he and the Family Members “duly applied and properly qualified” for the benefits offered under the Program. (Opening Br. at 6:13-14; see also Reply at 3:25-26 [“the Program is an entitlement to those who apply to it and qualify under its guidelines”], 4:20-21 [“[E]ach of the Tenants qualified for the Program by submitting a full, complete and accurate application”].) However, petitioner does not establish how the Family Members are qualified for rental assistance under the guidelines of the Program. Petitioner only asserts that he was told that the applications were complete. (AR 908.) Petitioner cites no authority for the proposition that completed applications automatically entitled him and the Family Members to benefits. Even if Lauren and Rina’s applications were previously approved (AR 772, 785), this does not mean they were entitled to benefits in perpetuity or that their entitlement to benefits could not audited, reevaluated, or rescinded.

Moreover, petitioner does not establish that HCD’s determination of the applications as inconsistent or unverifiable was an abuse of discretion. Indeed, the legitimacy of the leases is doubtful on their face. William’s annual income was $18,000, or an average of $1,500 per month. (AR 685.) However, William’s purported lease was for $3,600 per month, in excess of his monthly income. (AR 663, 746.) Rina’s annual income was $18,380, an average of $1,531.67 per month. (AR 437, 501-02). However, her purported lease was for $1,500 per month, leaving Rina $31.67 per month for other expenses. (AR 413, 645.) Victoria had no income, but she entered into a purported lease for $2,200 per month. (AR 204, 401, 643.) Lauren’s annual income was $25,000, or $2,083.33 per month. (AR 117.) However, Lauren’s purported lease was for $2,200 per month, leaving her $116.67 for other expenses per month. (AR 109, 641.) Clare’s income was $19,832, or an average of $1,615.17. (AR 296.) Her purported lease was for $1,500 per month, leaving her $115.17 for other expenses per month. (AR 273, 639.) While it may be true that “a large portion of the Los Angeles population have rent or mortgage obligations that are disproportionate to their income” (Reply at 3:21-22), HCD was entitled to question whether purported leases that are either in excess of the applicants’ stated income or in an amount that left the applicants approximately $30 to $100 per month to cover other expenses, such as food, transportation, and phone, were legitimate.

In a petition for writ of traditional mandate, the petitioner has the burden to establish that HCD’s denials were arbitrary, capricious, or lacking entirely in evidentiary support. (Ideal Boat, 208 Cal.App.4th at 311; California Correctional Peace Officers Assn., 10 Cal.4th at 1154.) For the foregoing reasons, petitioner fails to demonstrate why the applications should not have been denied.

Invoking CCP § 1094.5, petitioner seeks a hearing at which he can present entitlement to the benefits and any opposition can be heard. CCP § 1094.5 is applicable to “any final administrative order or decision made as the result of a proceeding in which by law a hearing is required to be given, evidence is required to be taken, and discretion in the determination of facts is vested in the inferior tribunal….” (CCP § 1094.5(a).) Accordingly, to obtain a writ of administrative mandate, petitioner must establish that the May 2022 denials were the result of an evidentiary hearing required under law. However, petitioner has not cited any authority indicating that such an evidentiary hearing was required in response to the applications for rental assistance.

Petitioner argues that “purely documentary proceedings can satisfy the hearing requirement of Code of Civil Procedure section 1094.5, so long as the agency is required by law to accept and consider evidence from interested parties before making its decision.” (Friends of the Old Trees v. Department of Forestry & Fire Protection (1997) 52 Cal.App.4th 1383, 1391.) That may be true, but it has no bearing on the issue of whether HCD was required to conduct an evidentiary hearing with respect to the subject rental assistance applications.

In any event, regardless of whether HCD was required to conduct an evidentiary hearing with respect to petitioner and the Family Members’ applications, on paper or otherwise, petitioner did not establish that he or his Family Members filed an appeal after the denials were sent in May 2022. For the reasons stated above with respect to exhaustion of administrative remedies, petitioner and his Family Members have thus forfeited any entitlement to any further proceedings.

The petition is DENIED. Pursuant to Local Rule 3.231(n), respondent shall prepare, serve, and ultimately file a proposed judgment.

[1] Although only the application of five family members are at issue in this case; six family members applied for benefits. The sixth is Betty Louza, whom HCD determined to be petitioner’s mother-in-law. (AR 513-614; see also Opening Brief p. 3, fn. 1.)