Judge: James C. Chalfant, Case: 22STCP01678, Date: 2023-09-19 Tentative Ruling
Case Number: 22STCP01678 Hearing Date: September 19, 2023 Dept: 85
Center International
Investments, Inc. vs. City of Monterey Park, 22STCP01678
Tentative decision on petition
for writ of mandate: partly decided and stayed
Petitioner
Center International Investments, Inc. (“Center”) seeks a writ of mandate
compelling Respondent City of Monterey Park (“City”) to issue a grading permit
(“Permit”) for the hilltop property at 1688 West Garvey Avenue (“Property”)
pursuant to a
project to build 16 single-family residences on the Property
(“Project”).
The
court has read and considered the opening brief, opposition, and reply,[1]
and renders the following tentative decision.
A. Statement of
the Case
1. First Amended Petition
Center
commenced this action on May 3, 2022.
The operative pleading is the First Amended Petition (“FAP”), filed on August 31, 2022, alleging
(1) administrative and traditional mandamus based on the Housing Accountability
Act (“HAA”), (2) traditional mandamus based on a temporary and permanent taking
under the Fifth Amendment to the U.S. Constitution, (3) inverse condemnation,
(4) violation of substantive due process under the Fourteenth Amendment of the U.S.
Constitution, (5) violation of the Equal Protection Clause under the Fourteenth
Amendment of the U.S. Constitution, (6) violation of mandatory duties under
Government Code (“Govt. Code”) section 815.6, (7) traditional mandamus, and (8)
administrative and traditional mandamus for violation of the Housing Crisis Act
(“HCA”).
The FAP alleges in pertinent part as follows.
a.
Background
In
1978 and 1979, Good Views Land Development Company (“Good Views”) received
approval to develop 31 residential units on the Property. In 1983, the Property’s slope failed, which
blocked and damaged Garvey Avenue. The
City took emergency action to construct soil stabilizations and drainage
infrastructure.
In
1986, the City and Good Views entered into an agreement to construct permanent
structures for the stabilization of the Property’s hillside. Although City consultants advised various
measures to stabilize the hillside from 1987 to 1989, Good Views did not
implement any of them. As a result, it
failed to adequately remediate the issues with the hillside.
In 1991, the
City issued a notice of violation to Good View that the hillside is a public
nuisance requiring abatement. Between
1991 and 1997, Good Views abandoned the Property. In 1997, the City Council declared
the Property a public nuisance and began to abate the Property
itself. The City took abatement actions
in 2000 and 2002.
In 2013,
Center became the new Property owner, and the City commenced enforcements actions against
it. In 2015, predictions of El Niño
storms led the City to believe that significant slope failure could occur on
the Property. On December 31, 2015, the
City filed suit for abatement against Center, The People of the State of California,
ex rel., Mark D. Hensley, City Attorney for the City of Monterey Park v. Center
Int’l Investments, Inc., (“Abatement Case”) (2015), Case No. BC605788.
On April
25, 2017, the parties entered into a Settlement Agreement for the Abatement Case
which addressed a long-term solution to the Property’s instability. Under the Settlement Agreement, Center would
implement a City-approved interim erosion control and slope stabilization plan
until permanent remediation was possible.
Permanent remediation would consisted of a series of retaining walls and
other geotechnical solutions. The permanent
remediation could be either be integrated into the development of a residential
community (“Plan A”) or implemented before any such development on the Property
(“Plan B”). Performance under Plan B was
due to be performed by 2022 even if the City Council did not approve Plan
A. If Center failed to comply, the City
could complete Plan B at Center’s expense.
b. 2017-19
Efforts to Perform the Settlement Agreement
On
April
28, 2017, the City confirmed receipt of Center’s application for two tentative tract
maps to subdivide the Property into 19 single-family residences and 14 condominium units. After much delay from the City in reviewing
the application, on September 13, 2017, Center met with City and AECOM, the City’s
third-party consultant responsible for review of the application. The City recommended that Center hire its own
third-party consultant to finish the review.
On March 1,
2018, Center met with City representatives to discuss the entitlements
necessary for development of the Project.
The next day, the City replaced AECOM with a new third-party consultant,
Converse Consultants.
On March
26, 2018, the City advised Center to change the number of proposed units to
“TBD” because there were too many open issues with geotechnical to determine a
definitive number of residential units.
On May 3, 2018, the City reported that the specific plan for the Project
was not advancing because the site plan, geotechnical issues, and number of
units were still up in the air.
On July 10,
2018, the City reported that it had again switched third-party consultants to Geosyntech. It also explained that recent issues with the
General Plan’s Land Use Element (“LUE”) would affect the City Council’s
authority to approve plans or variances for the Project.
On February 14, 2019, Center
provided the City with milestones for the proposed entitlements and
development. The City Attorney responded
that the City was done discussing timelines.
The next day, the City Attorney informed Center it would send a notice
of default and demand for voluntary abatement.
The City Attorney then recanted and directed City staff to work with
Center to revise the Settlement Agreement’s timeline. The parties executed an amendment to that
effect on March 22, 2019.
Center retained KCM as the Project
manager. On July 29, 2019, the City
informed KCM that any development needed 25 dwelling units to comply with a
pending LUE update. This drastic change
to the site plan would make it impossible to comply with the amended
milestones. The City chose not to put
the LUE proposition on the 2019 ballot because it was cost prohibitive. This left Center’s Project in limbo. Although the City later introduced a new
proposed LUE (“Measure II”), the electorate rejected it in March 2020.
On June 17, 2020, the City Council
approved a proposition for a new LUE (“Measure JJ”). The electorate voted in favor of Measure JJ
in November 2020, which changed the Property’s zoning.
c. Subsequent
Settlement Performance Efforts
On January
13, 2020, Center submitted applications for the revised Project which included
the Environmental Impact Report (“EIR”), a 688 West Garvey Specific Plan
(“Specific Plan”), a zone change, Vesting Tentative Map (“VTM”), and a Development
Agreement (collectively, “Entitlements”).
The revised Project included Plan A but also a “Plan B2.” Plan B2 provided for slope stabilization like
Plan B but in a way that allowed for residential development like Plan A.
On February
5, 2020, the City told KCM that Plan B2 had to go through the same hearing
process as any other development. After
KCM received comments, it revised and resubmitted Plan B2 on May 8, 2020.
On May 13,
2020, KCM explained to the City that Center was prepared to proceed with slope
remediation but had been advised that the Project still needed City Council
approval. In light of the Settlement Agreement’s
milestones, KCM asked if Center could commence Plan B2’s slope remediation
while waiting for City Council approval of the residential development
components. The City never responded.
On May 29,
2020, Center submitted the Initial Study and a draft Notice of Preparation
(“NOP”). After the City’s comments, Center
resubmitted them on July 2, 2020. On
July 9, 2020, Center submitted a Draft EIR (“DEIR”). On July 10, 2020, the City explained it would
not accept a DEIR until the NOP was published, but it did not explain why that
had not happened.
On July 16,
2020, the City notified KCM that it was publishing the NOP. This breached the Settlement Agreement, which
required that the City publish the NOP by May 29, 2020. The City did not explain how to address its
breach and its effect on later milestones.
On July 22,
2020, per the California Environmental Quality Act (“CEQA”), the City
circulated the NOP with the Initial Study for review and comment.
During a
conference call on August 7, 2020, the City explained that, while it had no
additional comments on Plan B2, it could not be approved until the City Council
approved the residential component. This
breached the Settlement Agreement which permitted this exact scenario.
On August
18, 2020, Center proposed a revised timeline for Project processing that included
the desired November 2020 City Council hearing date for consideration of the
whole Project. The City Attorney said
that the proposed schedule “seems OK”.
Between
August 24 and September 2, 2020, Center received City and public comments on
the DEIR. After additional rounds of
comments and revisions, Center provided a revised DEIR on November 16, 2020. On November 20, 2020, the City raised a new
issue of traffic safety concerns based upon line-of-sight issues on the
driveway to the Project. After detailed
discussions between experts, Center submitted an updated DEIR on January 12,
2021.
The cycle
of updated DEIRs and new comments continued until March 9, 2021, when the City
submitted the latest DEIR to the State Clearinghouse. The Settlement Agreement had required that
the City do so by July 10, 2020. On
March 11, 2021, Center released the DEIR for public review.
On June 16,
2021, the City Council conducted a public hearing to certify the EIR and
approve the Project-related Entitlements.
The City Council approved the Entitlements, finding that the Project conforms
to the City’s General Plan and zoning. It
also passed a Public Contracts Code Waiver that authorized the City Manager to
contract with a third party to stabilize the hillside without having to bid the
public project in case it had to pursue Plan B.
The
Development Agreement became effective on July 17, 2021, with a 20 year
duration. The Development Agreement granted
Center the right to develop the Project in accordance with the Entitlements. To expedite development, City agreed to
reasonably cooperate with Center to establish time frames for processing and
reviewing such ministerial permits and approvals and discretionary actions. It would also comply with any timeframes set
in the Entitlements. This included a
duty to promptly commence and diligently proceed to complete required steps
once Center meets the prerequisites.
On
June 18, 2021, Center submitted the Permit application. Approval of a grading permit application is
ministerial, but the City said that it would engage in a stringent plan check
process. For the next few months, the
City requested changes or additional documents from Center.
On
October 5, 2021, City staff confirmed that the City had everything it needed to
issue the Permit. On December 17, 2021,
the City
Attorney informed Center that he believed the City would not issue the Permit. Because Center never received a final action
from the City, it had nothing from which to appeal under Building Code section
113.
d.
Litigation with Save Our Slopes
On
July 21, 2021, petitioner Save Our Slopes challenged the Entitlements and Public
Contracts Code Waiver via petition for writ of mandate against Center and City
in Save Our Slopes v. City of Monterey Park et seq., Los Angeles Superior
Court, (“SOS”) Case No. 21STCP02365.
Center acknowledged that SOS would delay development of the
Project but continued to apply for the necessary approvals for the slope remediation.
On October
13, 2021, the City informed Center that it was engaging in its own settlement
negotiations for SOS and did not want Center to interfere.
e. The
City’s Notice of Default
On October
13, 2021, the City issued a Notice of Default (“NOD”) for the Settlement
Agreement. The NOD informed Center that,
pursuant to the Settlement Agreement, the City was taking over the Property and
completing Plan B.
On October
19, 2021, Center formally contested the NOD.
The same day, City staff replaced the locks on the Property.
On November
17, 2021, the City obtained an abatement warrant (“Abatement Warrant”) without
notice to Center to begin a narrow scope of slope abatement actions, including temporary
winterization.
On January
15, 2022, KCM informed Center that their contract had expired and that KCM was
entering a new contract with the City.
On February
17, 2022, the City filed a motion to enforce the Settlement Agreement and
obtain permanent control over the Property so that it could perform abatement measures beyond what the
Abatement Warrant allowed.
On March 2,
2022, the California State Water Resources Control Board (“Water Board”) issued
a Receipt of Your Notice of Intent to the City’s commitment to comply with the
terms of the General Permit to Discharge Storm Water Associated with
Construction Activity required by the federal Clean Water Act and
Porter-Cologne Water Quality Control Act.
The City necessarily must have filed the Stormwater Pollution Prevention
Plan (“SWPPP”) while it was reviewing Center’s Permit application that included
Center’s SWPPP.
The Abatement
Warrant expired, and the City withdrew its motion to enforce the Settlement
Agreement. The City now is in control of
the Property without any court authorization or permission from
Center. The City’s slope remediation
actions have not abated the issue because there are gaps and deterioration in
the sheeting covering the slope. The
City is also pursuing a slope remediation option that will make further Property
development impossible.
The City is
delaying the SOS case so that it can complete slope stabilization with the
Public Contracts Code Waiver and without engaging in the public bidding process. After stabilization, the City plans to settle
the SOS case by voiding the Entitlements.
f. Center’s
Notice of Default
On
April 4, 2022, Center served the City with a Notice of Default under the
Development Agreement for failing to issue the Permit and failing to cooperate in
defending the SOS case.
On
May 16, 2022, the City responded to the Notice of Default, alleging that Center had
no active Permit application. This
contradicted its assurance on October 5, 2021 that the application was
complete. The City alleged that the Permit
application expired either on December 20, 2021 or March 18, 2022. Meanwhile, the City’s failure to take final
action on the Permit application left Center with nothing to appeal.
The City
told Center that it needed to file a government claim under Civil Code section
911.2. Center filed this claim on June
8, 2022. The City did not respond by the
July 25, 2022 deadline.
g. Prayer
for Relief
Center
seeks (1) a writ of mandate compelling the City to issue the Permit (2)
judgment that the City’s unlawful failure to issue the Permit, the NOD, and
ongoing Property changes are a taking of Center’s property (3) judgment that
the City’s unlawful failure to issue the Permit and ongoing physical changes to
the Property, which will render Center unable to develop the Property in
accordance with the Entitlements, is an inverse condemnation; (4) a preliminary
and permanent injunction compelling the City to issue the Permit; (5)
compensatory damages for constitutional due process violations; (6) a
judgment declaring that the City’s approval of the updated LUE and failure to
issue the
Permit violated the HCA, and ordering the City to rescind the LUE; (7) general,
special, and incidental damages; and (9) attorney’s fees and costs.
2. Course of Proceedings
On
May 5, 2022, Center served the City with the Petition and Summons.
On
August 31, 2022, Center filed and served the FAP.
On
September 15, 2022, the court stayed all non-mandamus causes of action in the
FAP, leaving only the first, six, seventh, and eighth causes of action at issue.
On
July 14, 2023, the City filed an Answer to the claims not stayed. On July 27, 2023, the City amended its
Answer.
B. Standard of Review
The
parties analyze the issues under both traditional
and administrative mandamus. Pet. Op. Br. at 11-12; Opp. at 11-12.
1. Traditional
Mandamus
A petition
for traditional mandamus is appropriate in all actions “to compel the performance
of an act which the law specially enjoins as a duty resulting from an office,
trust, or station....” CCP §1085. Traditional mandamus permits
judicial review of ministerial duties as well as quasi-legislative and
legislative acts. County of Del Norte v. City of Crescent City,
(1999) 71 Cal.App.4th 965, 972.
A traditional writ of
mandate is the method of compelling the performance of a legal, ministerial
duty required by statute. See Rodriguez v. Solis, (1991) 1
Cal.App.4th 495, 501-02. Generally, mandamus will lie when (1) there is
no plain, speedy, and adequate alternative remedy, (2) the respondent has a
duty to perform, and (3) the petitioner has a clear and beneficial right to
performance.” Pomona Police Officers’ Assn. v. City of Pomona,
(1997) 58 Cal.App.4th 578, 583-84 (internal citations omitted). Whether a
statute imposes a ministerial duty for which mandamus is available, or a mere
obligation to perform a discretionary function, is a question of statutory
interpretation. AIDS Healthcare Foundation v. Los Angeles County Dept.
of Public Health, (2011) 197 Cal.App.4th 693, 701.
In the absence of a ministerial duty, traditional mandamus
relief is unavailable unless the petitioner can demonstrate an abuse of that
discretion. An agency decision is an
abuse of discretion only if it is “arbitrary, capricious, entirely lacking in
evidentiary support, unlawful, or procedurally unfair.” Kahn v. Los Angeles City Employees’
Retirement System, (2010) 187 Cal.App.4th 98, 106. In applying this deferential test, a court
“must ensure that an agency has adequately considered all relevant factors, and
has demonstrated a rational connection between those factors, the choice made,
and the purposes of the enabling statute.”
Western States Petroleum Assn v. Superior Court, (1995) 9 Cal.4th
559, 577. Mandamus will not lie to
compel the exercise of a public agency’s discretion in a particular
manner. American Federation of State,
County and Municipal Employees v. Metropolitan Water District of Southern
California, (2005) 126 Cal.App.4th 247, 261. It is available to compel an agency to
exercise discretion where it has not done so (Los Angeles County Employees
Assn. v. County of Los Angeles, (1973) 33 Cal.App.3d 1, 8), and to correct
an abuse of discretion actually exercised.
Manjares v. Newton, (1966) 64 Cal.2d 365, 370-71. In making this determination, the court may
not substitute its judgment for that of the agency, whose decision must be
upheld if reasonable minds may disagree as to its wisdom. Id. at 371. A writ will lie where the agency’s discretion
can be exercised only in one way. Hurtado
v. Superior Court, (1974) 11 Cal.3d 574, 579.
A legal issue is “subject to de
novo review. Citizens for E.
Shore Parks v. State Lands Com., (2011) 202 Cal.App.4th 549, 573.
“It is well-established that an
agency’s action must be upheld, if at all, on the basis articulated by the
agency itself” rather than “post hoc rationalizations.” See, Motor Vehicle Manufacturers.
Ass’n of the United States, Inc. v. State Farm Mut. Auto. Ins. Co., 463
U.S. 29, 50 (1983). California courts
apply this rule in mandamus actions where the agency is subject to a written
findings requirement such as in Govt. Code sections 66589.5(j)(1) and
6300(b)(1)(B)(i). SP Star
Enterprises, Inc. v. City of Los Angeles, (2009) 173 Cal. App. 4th 459,
477, n. 4.
2. Administrative Mandamus
Agency decisions under the
HAA are reviewed as administrative mandamus. §65589.5(m); Honchariw v.
County of Stanislaus, (“Honchariw”) (2011) 200 Cal.App.4th 1066, 1072. CCP section 1094.5 is the administrative
mandamus provision which structures the procedure for judicial review of
adjudicatory decisions rendered by administrative agencies. Topanga
Association for a Scenic Community v. County of Los Angeles, (“Topanga”)
(1974) 11 Cal.3d 506, 51415. The pertinent issues under section 1094.5
are (1) whether the respondent has proceeded without jurisdiction, (2) whether
there was a fair trial, and (3) whether there was a prejudicial abuse of
discretion. CCP §1094.5(b). An abuse of discretion is established
if the respondent has not proceeded in the manner required by law, the decision
is not supported by the findings, or the findings are not supported by the
evidence. CCP §1094.5(c).
CCP
section 1094.5 does not in its face specify which cases are subject to
independent review of evidentiary findings. Fukuda v. City of Angels,
(1999) 20 Cal.4th 805, 811. Instead, that issue was left to the
courts. In cases other than those requiring the court to exercise its
independent judgment, the substantial evidence test applies. CCP
§1094.5(c). Land use decisions do not typically involve vested rights
requiring independent review. See PMI Mortgage Insurance Co. v.
City of Pacific Grove, (1981) 128 Cal.App.3d 724, 729. The granting
of a permit or variance does not infringe on the fundamental vested rights of adjoining
property owners. Bakman v. Dept. of Transportation, (1979) 99
Cal.App.3d 665, 689-90. A landowner does not have either an easement for
air and light in the absence of an express covenant (Katcher v. Home Savings
& Loan Assn, (1966) 245 Cal.App.2d 425, 429), and there is no vested
right in the enforcement of a zoning ordinance. Hermosa Beach Stop Oil
Coalition v. City of Hermosa Beach, (2001) 86 Cal.App.4th 534,
552.
“Substantial
evidence” is relevant evidence that a reasonable mind might accept as adequate
to support a conclusion (California Youth Authority v. State Personnel Board,
(2002) 104 Cal.App.4th 575, 585) or evidence of ponderable legal significance,
which is reasonable in nature, credible and of solid value. Mohilef v. Janovici, (1996) 51
Cal.App.4th 267, 305, n.28. The trial court considers all evidence in the
administrative record, including evidence that detracts from evidence
supporting the agency’s decision. California Youth Authority, supra,
104 Cal.App.4th at 585.
An agency
is presumed to have regularly performed its official duties (Evid. Code §664),
and the petitioner seeking administrative mandamus therefore has the burden of
proof. Steele v. Los Angeles County Civil Service Commission,
(1958) 166 Cal.App.2d 129, 137; Afford v. Pierno, (1972) 27 Cal.App.3d
682, 691 (“[T]he burden of proof falls upon the party attacking the
administrative decision to demonstrate wherein the proceedings were unfair, in
excess of jurisdiction or showed prejudicial abuse of discretion).
The
agency’s decision at the hearing must be based on the evidence. Board
of Medical Quality Assurance v. Superior Court, (1977) 73 Cal.App.3d 860,
862. The decision-maker is only required to issue findings that give
enough explanation so that parties may determine whether, and upon what basis,
to review the decision. Topanga, supra, 11 Cal.3d at 51415.
Implicit in CCP section 1094.5 is a requirement that the agency set forth
findings to bridge the analytic gap between the raw evidence and ultimate decision
or order. Id.
C. Governing Law[2]
1. Housing
Accountability Act
The
Legislature adopted the HAA in 1982 to “significantly increase the approval and
construction of new housing for all economic segments of California’s
communities by meaningfully and effectively curbing the capability of local
governments to deny, reduce the density for, or render infeasible housing
development projects and emergency shelters.” Government Code[3] §65589.5(a)(2)(K). It
reflects the Legislature’s findings that “the availability of housing is of
vital statewide importance,” and that providing the necessary housing supply
“requires the cooperative participation of government and the private sector in
an effort to expand housing opportunities and accommodate
the housing needs of Californians of all economic levels.” §65580(a)-(b).
The
Legislature significantly amended the HAA, effective January 1, 2018, to
strengthen its provisions, expand its applicability, and increase local
governments’ liability for violations. The HAA found that California is
in the midst of a housing crisis that is “partially caused by activities and policies of
many local governments that limit the approval of housing, increase the cost of
land for housing, and require that high fees and exactions be paid by producers
of housing,” §65589.5(a)(1)(B). Many local governments do not give adequate
attention to the economic, environmental, and social costs of decisions that
result in disapproval of housing development projects, reduction in density of
housing projects, and excessive standards for housing development projects. §65589.5(a)(1)(D). The state’s
homeownership rate was at its lowest level since the 1940s and ranked 49 out of
the 50 states. §65589.5(a)(2)(E).
The lack of supply and rising costs are compounding inequality and limiting
advancement opportunities for many Californians. §65589.5(a)(2)(F).
The HAA states
that it should be “interpreted and implemented in a manner to afford the
fullest possible weight to the interest of, and the approval and provision of,
housing.” §65589.5(a)(2)(L).
Nothing in
the HAA relieves the local agency from complying with, inter alia, the
California Environmental Quality Act (“CEQA”). §65589.5(e). Nothing in the HAA aside from section 65589.5(o) shall be construed
to prohibit a local agency from requiring the housing development project to
comply with objective, quantifiable, written development standards, conditions,
and policies appropriate to, and consistent with, meeting the jurisdiction’s
share of the regional housing need.
§65589.5(f)(1). A housing development project “shall be deemed consistent,
compliant, and in conformity with an applicable plan, program, policy,
ordinance, standard, requirement, or other similar provision if there is
substantial evidence that would allow a reasonable person to conclude that the
housing development project or emergency shelter is consistent, compliant, or
in conformity.” §65589.5(f)(4).
The HAA limits the
application of project conditions that lower the residential density of the
project or have a substantial adverse impact on the viability or affordability
of providing units in housing affordable to lower- and
moderate-income households and emergency shelters. Pet. RJN Ex. E, p. 10. These limits apply to conditions that
directly or indirectly limit the overall number of units. Id.
They also apply to any condition that would have a substantial adverse
effect on the viability or affordability of the proposed housing. Id.
Section
65589.5(j)(1) provides:
“When a proposed housing development project complies with
applicable, objective general plan, zoning, and subdivision standards
and criteria, including design review standards, in effect at the time that the
housing development project's application is determined to be complete, but the
local agency proposes to disapprove the project or to impose a condition
that the project be developed at a lower density, the local agency shall base
its decision regarding the proposed housing development project upon written
findings supported by a preponderance of the evidence on the record that both
of the following conditions exist:
(A) The housing development project would have a specific,
adverse impact upon the public health or safety unless the project is
disapproved or approved upon the condition that the project be developed at a
lower density. As used in this paragraph, a “specific, adverse impact” means a
significant, quantifiable, direct, and unavoidable impact, based on
objective, identified written public health or safety standards, policies, or
conditions as they existed on the date the application was deemed complete.
(B) There is no feasible method to satisfactorily mitigate
or avoid the adverse impact identified pursuant to paragraph (1), other than
the disapproval of the housing development project or the approval of the
project upon the condition that it be developed at a lower density.” (emphasis
added).
A local
agency disapproves a housing development project when it votes on a housing
development project application, including any required land use approvals or
entitlements necessary for the issuance of a building permit, and disapproves
it. §65589.5(h)(6)(A).
The HAA
defines a “specific, adverse impact” as a “significant, quantifiable, direct,
and unavoidable impact, based on objective, identified written public health or
safety standards, policies, or conditions as they existed on the date the
application was deemed complete.” §65589.5(j)(1)(A). The Legislature’s
intent is that conditions that would have a specific, adverse impact upon the
public health and safety should arise infrequently.
§65589.5(a)(3).
If a
permitting agency considers a proposed housing development project to be
inconsistent with “an applicable plan, program, policy, ordinance, standard,
requirement, or other similar provision,” it must provide the applicant
with written documentation identifying and explaining the claimed inconsistency
within either 30 or 60 days of the submittal of a complete application,
depending upon the size of the project. §65589.5(j)(2)(A). Absent timely
notice, the project is deemed to be in
compliance with all applicable standards as a
matter of law. §65589.5(j)(2)(B).
If the
court finds that an agency acted in bad faith in disapproving a project in
violation of the HAA, the appropriate remedy is an “order or judgment directing
the local agency to approve the housing development project.”
§65589.5(k)(1)(A)(ii). “Bad faith” “includes, but is not limited to, an
action that is frivolous or otherwise entirely without merit.”
§65589.5(l).
The City
bears the burden of proving that its decision conforms to the conditions
specified in section 65589.5. §65589.6.
Section 65589.5(j) applies
to market rate housing as well as affordable housing. Honchariw, supra, 200 Cal.App.4th at 1070. The HAA Act applies to all
residential housing developments and takes away the agency’s ability to deny
residential projects based on subjective development policies. Id.
at 1072-77.
2. The Housing Crisis Act
In 2019, the
Legislature enacted the HCA, declaring, despite the HAA, a temporary
housing emergency statewide in order to preserve existing housing, enhance
protections for occupants, and increase certainty in the development review
process. See SB 330 §2(b).
Among other limitations, the law
ensures housing production is not stymied by precluding an affected county or
city – including charter cites and the electorate – from either reducing
existing residential intensities or imposing a limitation on housing
development within all or a portion of an affected city without first making a
finding of an “imminent threat” to public health and safety. §§
66300(a)(1)(B)(3), (b)(1)(A), (b)(1)(B)(i), 65589.5. The HCA prohibits an affected city
“…from enacting a development policy, standard, or condition,
as defined, that would have the effect of (A) changing the land use
designation or zoning of a parcel or parcels of property to a less intensive
use or reducing the intensity of land use within an existing zoning district
below what was allowed under the general plan or specific plan land use designation
and zoning ordinances of the county or city as in effect on January 1, 2018….” §66300(b)(1) (emphasis added).
An “affected county” or “affected city” includes the
electorate of an affected county or city exercising its local initiative or
referendum power, whether that power is derived from the California
Constitution, statute, or the charter or ordinances of the affected county or
city. §66300(a)(3). “Reducing the intensity of land use” includes
reductions to height, density, or floor area ratio, new or increased open space
or lot size requirements, new or increased setback requirements, minimum
frontage requirements, or maximum lot coverage limitations, or any other action
that would individually or cumulatively reduce the site’s residential
development capacity. §66300(b)(1)(A). These prohibitions apply to any land use
designation amendment or change adopted on or after January 1, 2020, and any change
as of that date is void.
§66300(b)(2).
To maximize
the development of housing within this state, section 66300 should be broadly
construed and any exception thereto narrowly construed, including an exception
for the health and safety of occupants of a housing development project. §66300(f)(2).
3. Development
Agreements
Any city
or county may enter into a development agreement with any person having a legal
lor equitable interest I real property for its development. §65865(a).
The development agreement shall specify the duration of the agreement,
the permitted uses of the property, the density or intensity of use, the
maximum height and size of proposed buildings, and provisions for reservation
or dedication of land for public purposes. §65865.2.
The development agreement may include conditions, terms, restrictions,
and requirements for subsequent discretionary actions, provided that such conditions,
terms, restrictions, and requirements for subsequent discretionary actions
shall not prevent development of the land for the uses and to the density or
intensity of development set forth in the agreement. Id.
The agreement may provide that construction shall be commenced within a
specified time and that the project or any phase thereof be completed within a
specified time. Id.
Unless otherwise provided by
the development agreement, the rules, regulations, and official policies
governing permitted uses of the land, density, and design, improvement, and
construction standards and specifications that are in force at the time of
execution of the agreement she apply to development of the property. §65866(a).
Unless
amended or canceled pursuant to section 65868, or modified or suspended
pursuant to section 65869.5, and except as otherwise provided in section
65865.3(b), a development agreement shall be enforceable by any party thereto
notwithstanding any change in any applicable general or specific plan, zoning,
subdivision, or building regulation adopted by the city, county, or city and
county entering the agreement, which alters or amends the rules, regulations,
or policies specified in section 65866.
§65865.4.
4. Monterrey
Park Municipal Code
a. Administrative
Proceedings
The City Manager
has the duty and power to: (2) control, order and give directions to all heads
of departments, subordinate officers and employees of the city, except the city
clerk, city treasurer and city attorney; and (4) exercise control over all
departments of the City government and over all appointive officers and
employees thereof. Opp. RJN Ex. A (MPMC
2.08.070).
Except as
otherwise provided by Chapter 1 of the MPMC, decisions rendered by City department
directors in accordance with this code may be administratively appealed to the City
Manager or his/her designee. MPMC
1.10.010(c). The Planning Commission is
designated to hear and decide appeals of orders, decisions, or determinations
made by the Building Official relative to the application and interpretation of
this code. Opp. RJN Ex. A (MPMC 16.01.040,
§113.1).
All
appeals must be filed within ten calendar days of the date of the rendering of
the decision. MPMC 1.10.020. If the tenth day occurs on a holiday or
weekend, the appeal period is extended to the next city workday. Id.
No appeal can be accepted after the appeal period expires. Id.
Any person appealing the decision of the Building Official must file
with the Building Official a written application accompanied by a filing fee in
accordance with the fee schedule adopted by City Council resolution at any time
not more than 20 calendar days after the decision of the Building Official. Opp. RJN Ex. A (MPMC 16.01.040, §113.3).
Notwithstanding
any other provision of law, CCP section 1094.6 applies to any decision of the
City or any of its commissions, boards, officers or agents which are subject to
review under CCP section 1094.5. Opp.
RJN Ex. A (MPMC 1.16.010). Any person
dissatisfied with a final decision by the City Council, Planning Commission, or
a City official under the MPMC may challenge it within 90 days. Opp. RJN Ex. A (MPMC 3.12.030). The definition of “final decision” mirrors
that of CCP section 1094.6(e). Id. Notices required under CCP section 1094.6(f) for
final decisions must be substantively worded as “This constitutes the City’s
final decision and becomes immediately effective. Any challenge brought against
this final decision must be filed within ninety days pursuant to Code of Civil
Procedure Section 1094.6.” Id.
b. Land
Use Amendments
No
amendment of the LUE of the City’s General Plan, the zoning map, and/or the
Zoning Code as amended, or any other action of the City Council by which there
would be permitted any use of land other than as presently defined in the LUE,
zoning map, and/or Zoning Code shall be valid or effective for any purpose
unless and until such amendment shall have been approved by a majority of those
voters of the City voting thereon at any regular or special municipal election. Te City Council shall refer any such amendment
approved by it to said voters pursuant to the provisions of Elections Code section
4017. MPMC 21.42.010.
c. Development
Regulations
Any owner
or authorized agent who intends to construct, enlarge, alter, repair, move,
demolish, or change the occupancy of a building or structure, or to erect,
install, enlarge, alter, repair, remove, convert or replace any electrical,
gas, mechanical or plumbing system, the installation of which is regulated by
the codes, or to cause any such work to be done, must obtain a valid permit
from the Building Official. MPMC
16.01.040, §105.1.
The MPMC
incorporates the California Building Code, Title 24 of the California Code of
Regulations (“24 CCR”). MPMC 16.21.010 (Opp.
RJN Ex. A). The code official will
examine or cause to be examined applications for permits and amendments within
a reasonable time after filing. Building
Code §§ 105.3.1, 105.4. If the
application or the construction documents do not conform to the requirements of
applicable law, the code official must reject such application in writing. Building Code §105.3.1. Conversely, when the
code official is satisfied that the proposed work conforms to the requirements
of applicable law, and the specified fees have been paid, the code official must
issue a permit in accordance with applicable law. Building Code §§ 105.3.1, 105.4. No building permit or similar applicable
permit bearing on property development or use including additions,
modifications or revisions may be issued unless and until the review and
approval of all other departments and agencies having legal authority for
review of construction projects have found the construction project to be in
compliance with all applicable code provisions or entitlements. Building Code §105.3.1.
An
application for a permit for any proposed work is deemed expired or abandoned
180 days after the completion of any submittal review unless a permit has been
issued. Building Code § 105.3.2. For such purposes, contact by a City
representative indicating that review is complete qualifies as completion of
the submittal review. MPMC §16.01.040; Building
Code §105.3.2. The code official is
authorized to grant one extension of time of an unexpired application for
additional periods not exceeding 90 days.
Building Code §105.3.2. The
extension must be requested in writing and justifiable cause demonstrated. Building Code §105.3.2.
D. Statement of Facts
1. Background
The Property consists of
6.22 acres of undeveloped land on a hillside along West Garvey Avenue located
at 1688 West Garvey, Monterey Park, California.
AR 96, 19132. Its appraisal value
as of October 2022 is $6.4 million. AR
18960.
The Property is
historically unstable. AR 19132. In 1983, a hillside slope failure on the
Property blocked and damaged West Garvey Avenue. AR 19132.
The City took emergency action to construct various soil stabilization
and drainage infrastructure. AR 19132. The City removed soils debris from the
roadway and installed a soils impact wall along a portion of the Property line along West Garvey Avenue. AR 19132.
In 1986, the City
entered into an agreement with the Property owner, Good Views Land Development
Company (“Good Views”), to construct permanent structures to stabilize the
hillside. AR 19132. Good Views was required to finish the
structures by December 5, 1986. AR
19132. Although City consultants
identified the necessary measures to stabilize the hillside over the next three
years, Godd View did not implement any of them.
AR 19132. Beginning in 1991, the
City issued annual notices of violation that identified the Property as a
public nuisance requiring abatement. AR
19132.
In 1994, the City could
no longer locate Good Views’ representatives.
AR 19132. In 1997, the City
Council declared the Property a public nuisance and ordered construction of various
abatement measures. AR 19132. One measure was to install a gate on the
abandoned private road on the Property.
AR 19132. The City took
additional abatement measures in 2000 and 2002.
AR 19132. By 2013, the City had
expended between $200,000 to $300,000 to abate dangerous nuisances on the
Property. AR 19132.
2. Center’s Ownership
In 2009, Center purchased the Property to build a residential
development of 16 homes. AR 19788.
Beginning in 2013, the City
took various code enforcement actions against Center with respect to the
Property. AR 15813-24. On March 8, 2013, the City issued an administrative
citation for improper slope drainage, improper slope maintenance, unsightly
appearance, and illicit discharge/disposal.
AR 15820. The Center did not comply
with the citation. AR 15821.
Between March 26, 2013
and December 1, 2014, the City issued four additional citations for continuing
violations of trash, debris, overgrown vegetation, erosion control, storm water
runoff, improper slope maintenance, and other issues. AR 15813-16.
The City directed Center to provide mitigation plans to address these
issues. AR 15813-16. Center implemented only minor corrective
actions that failed to remediate the cited matters. AR 15821-22.
On December 16, 2014, a
large pine tree on the Property toppled and crushed an electric pole. AR 15833.
This led to the emergency street closure of West Garvey Avenue for about
18 hours and left 60 homes without power.
AR 20139.
On May 12 and October
31, 2015, the City issued two additional administrative citations for improper
slope drainage, improper slope maintenance, unsightly appearance, and illicit
discharge/disposal. AR 20139. The May 12 citation ordered Center to set a
timeline for corrective actions and both citations ordered Center to obtain
professional help for the corrective action.
AR 20139.
Because Center failed to
take corrective action, on November 7, 2015 the City sent Center a Notice to
Repair or Abate with a history of Center’s non-compliance with the MPMC. AR 15834-15835. The abatement notice identified specific,
immediate steps for Center to undertake to remedy the conditions on the
Property. AR 15835.
The City attempted to
inspect the Property multiple times in December 2015. AR 15835-36.
Although it could not complete some inspections, the inspections that
were conducted revealed a failure to remedy the violations in the earlier
citations. AR 15835-36.
2. The Abatement Case
On December 31, 2015, the
City filed the Abatement Case against Center, alleging that the Property was in
an unsafe, unsightly and dangerous condition and seeking injunctive relief
compelling Center to immediately bring the Property in compliance with the
MPMC, or an order allowing the City to do so and compelling Center to reimburse
it. AR 20136-37, 201144.
In April 2017, the
parties reached the Settlement Agreement.
AR 20311-18. In the Settlement
Agreement, Center agreed to work with the City to complete the review and
correction process for a Restoration Plan to address all slope stability and public safety issues, and to obtain a permit
with all due speed. AR 20312. Center must then complete the hillside
restoration before December 31, 2017, unless the City Attorney extends the
deadline for good cause, such as a delay by the City in permit issuance or
inclement weather impeding construction.
AR 20312. Center was required to
obtain performance bonds of $1 million and, after completion of the construction
required under the Restoration Plan, regularly monitor and maintain the
Property through winterization measures and a temporary erosion control plan
until the City considered the permanent remediation complete. AR 20312-13.
If the Center failed to
perform its obligations under the Settlement Agreement, the City could file a
stipulated judgment enabling it to abate the nuisance with reimbursement of its
cost from Center. AR 20314, 20322. The City was not obligated to exercise its
discretion in a particular way, and Center waived any right to a notice and
hearing for which it otherwise would have a right under Rooney v. Vermont
Investment Corp. (1973), 10 Cal.3d 351.
AR 20314.
By March 2019, Center
had failed to take action to permanently stabilize the hillside and the parties
amended the Settlement Agreement. AR
20319. The amended Settlement Agreement outlined
two different courses of action to abate the nuisance. Plan A allowed Center to pursue the
residential project and seek the necessary discretionary approvals, including a
Development Agreement and subdivision map.
AR 20320. Center would abate the hillside
nuisance as part of the project. AR
20320.
Plan B addressed the hillside
slope nuisance independent of any development. AR 20320.
If Center failed to obtain the approvals needed for Plan A or otherwise
implement it by applicable deadlines, it must implement Plan B. AR 20320-21.
If Center failed to implement either Plan, the City unilaterally would
implement Plan B to abate the nuisance at Center’s expense. AR 20321.
The amended Settlement Agreement
included deadlines for compliance under either Plan. AR 20328-29.
By March 18, 2019, Center was required to complete new site grading and
preliminary wall analysis. AR 20328. If the City Council denied the residential
project, Center was required to the complete Plan B slope stabilization by
November 25, 2020. AR 20328. Nothing in the amended Settlement Agreement was
intended to limit the City’s present or future exercise of municipal powers in
accordance with the California Constitution and applicable law. AR 20324.
The amended Settlement Agreement
required a performance bond to secure performance of Plan B, and on July 29,
2019 the parties agreed on a bond amount of $6.8 million. AR 16037, 20321-22. On October 1, 2019, the City notified Center
that it was in default on the amended Settlement Agreement because it had not
posted the performance bond. AR
16036-37. The City threatened to pursue
all legal remedies, including immediate abatement through Plan B. AR 16037.
On June 8, 2020, the
parties amended the Settlement Agreement again.
AR 20331. The amended Settlement Agreement
modified the schedule for compliance under either Plan A or B. AR 20333-34. Under
the timeline, Plan B would begin on November 5, 2020 if the City Council denied
the project. AR 20337. The City would issue horizontal permits by
January 15, 2021, and Center would mobilize for horizontal improvements by
March 8, 2021. AR 20337.
Center agreed to
cause liens to be recorded in favor of the City in the amount of $6.8
million. AR 20333. In the event Plan B was not underway by the
deadline, the City could enter the Property and abate the nuisance or complete
Plan B and foreclose on the liens. AR
20334, 203337. The Project schedule
would not further change absent good cause, which the City would determine in
its sole discretion. AR 20333.
3. Change to the City’s LUE
On December 5, 2019, the
City Council passed Resolution No. 12124 which updated the General Plan’s LUE
and accepted the findings of the related EIR.
AR 17695. The City’s voters
rejected Resolution No. 12124, on the ballot as Measure II, on March 3, 2020. AR 16479-80.
On June 17, 2020, the
City Council passed Resolution No. 12179, which approved a new LUE. AR 16662.
The new LUE conformed to the LUE the General Plan Advisory Committee had
vetted and the Planning Commission proposed in Resolution No. 12124. Pet.
RJN Ex. C. It changed the Property’s land
use designation from High-Density Residential (up to 25 units per acre) to Low-Density
Residential (up to 8 units per acre). AR
284. The zoning designation remained R-3,
High-Density Residential, which allows a broad range of dwelling units at a
density of up to 25 units per acre. AR
284.
In November 2020, City voters
passed Measure JJ, which adopted Resolution No. 12179 and the new LUE. AR 16650-51.
On December 2, 2020, the City certified the results of the election, which
gave the new LUE an effective date of December 12, 2020. AR 16662.
4. Entitlements Approval
As amended, Plan A of the
Settlement Agreement required slope stabilization in conjunction with the
development of residential units on the Property. AR 20178.
Because Center sought to build and develop residential homes, Center
needed to obtain both discretionary and non-discretionary approvals from the
City to proceed.
a. The City Council Resolutions
In March 2021, Center prepared
a DEIR for the Project based on the Property’s current conditions. AR 290-98, 308.
At a June 16 City
Council meeting, staff reported that Center was given an August 1 deadline to
bring design-ready specifications for consideration. AR 2685, 2742-43. The City must then review them to ensure
compliance with the geotechnical report, and it would issue permits for
hillside grading and construction if appropriate. AR 2743.
Center did not object to this statement.
See AR 2743-49. Center also
acknowledged the August 1, 2021 deadline in a July 6, 2021 email. AR 14747.
At the end of the June
16, 2021 meeting, the City Council, in Resolution 12253, certified the EIR for
the Project, which included mitigation measures for each potentially
significant impact of the Project. AR 4-8.
On the same date,
the City Council, in Resolution 12254, approved the Project, described as 16
single-family homes, with the Entitlements of a zone change from R-3 to
Specific Plan, a VTM, and a Development Agreement, and finding the Project consistent
with the General and Specific Plans for the Property. AR 96, 98.
Again, on June 16, 2021,
the City Council, in Resolution 12255 and acting out of an abundance of
caution, City found that an emergency exists to abate the Property, which
constitutes an imminent threat to public health and safety that requires
immediate action under Public Contracts Code section 20168. AR 123-24.
The City Council stated that it is in the public interest to ensure
completion of the Project as required by the Settlement Agreement. AR 124.
If Center fails to complete the Project by the Settlement Agreement’s
deadlines, the City will assume responsibility for completing the hillside
abatement at Center’s cost. AR 124. In a Public Contracts Code Waiver, the City Council found that any delay resulting
from public bidding would adversely affect public health and safety. AR 123, 128.
123-124. If the City Manager, in
his sole discretion, did not find that Center made substantive progress by
August 1, 2021, he could bid the improvements and select the best qualified
contractor to execute them. AR 123-24.
On July 7, 2021, the
City Council passed Ordinance No. 2210, which amended the zoning for the
Property from R-3, High-Density Residential, to match the Specific Plan and
allow for single-family homes. AR 129,
132.
b. The Development Agreement
Also on July 7, 2021,
the City Council passed Ordinance No. 2211, which approved the Development
Agreement. AR 185, 188. The ordinance, and therefore the Development
Agreement, became effective 30 days later, on August 6, 2021. AR 188.
In the Development
Agreement’s recitals, the City recognized the benefits of the Project and stated that it was taking all actions
required for Center to begin and consummate the Project. AR 192.
This included the approval, adoption, or issuance of necessary
development permits, the future ministerial approval of building plans, and
ministerial approval of final maps, appropriate building permits, lot line
adjustments, and other necessary or desired permits, approvals and entitlements
which are consistent with the development of the Project. AR 192.
In exchange for Center’s
investment of monies in the Project, the City agreed to approve future land
uses for the Project, provided that Center satisfactorily complied with all
procedures, actions, payments, and criteria applicable as of the Development Agreement’s
effective date. AR 192, 197.
The City recognized that
expeditious processing of ministerial and discretionary permits and approvals would
be helpful to the Project and it agreed to reasonably cooperate with Center to establish
time frames for processing and reviewing such ministerial permits and approvals
and discretionary actions. AR 203. Once Center completed all required preliminary actions and payments of
appropriate processing fees, the City would promptly commence and diligently
proceed to complete all required steps necessary for the implementation of the Development
Agreement and the development of the Project.
AR 203. This included holding any
required public hearings, and processing and approving all ministerial approvals. AR 203-04.
The rules, regulations,
and policies applicable to the ministerial approvals that Center needs before
it can begin construction would be those in effect at the time of the Development
Agreement. AR 204. The City must make any ministerial approval
within a reasonable time after the
Center has applied for it. AR 204.
The parties could institute
legal action to cure a default, enforce any provision of the Development
Agreement, enjoin any violation or attempted violation, or enforce the Development
Agreement by specific performance. AR
210. A separate term sheet identified
the duration of the Development Agreement as 20 years. AR 3148.
c. The Permit Application
On June 18, 2021, Center
submitted the Permit application. AR
19557. The application sought a permit
for grading and slope stabilization plans, geotechnical reports, calculations,
and grading permit applications. AR
16965-66, 16972-88, 17007, 17011-68, 17169-78, 17187, 17188-92, 17193-94, 17196-97.
The City advised Center
that the plans were outdated and included aspects that were not reviewed for
the DEIR. AR 15778. As a result, the City would perform the plan
check review as a technical construction document (shovel ready) and not as a
feasibility document. AR 15778.
On June 30, 2021, the
City reminded Center that they were 39 days away from the August 1, 2021
deadline for the City’s determination whether to pull the trigger for Plan
B. AR 19559. A review of the submitted plans revealed that
they were the plans from May 2020 for environmental review. AR 19559.
They were not plans that may be used for issuing permits. AR 19559.
On July 16, 2021, Center
submitted revised application materials.
AR 17007-08. This included
responses to City comments, updated calculations, an Erosion Control Plan
(“ECP”), and an updated SWPPP. AR 17008.
On July 26, 2021, the
City sent Center comments on the Permit application materials. AR 17011.
One comment noted the 2013 start date of the submitted SWPPP. AR 17034.
On July 30, 2021, the
City asked Center if it was working on resubmittals based on its comments. AR 19566.
Center replied that it was working on addressing the comments and would
inform the City when finished. AR 19568.
On August 9, 2021, the
City demanded that Center submit the Permit application by the end of the next
day. AR 17693.
On August 10, 2021, Center
sent a revised Permit application. AR
17186-87. In response, the City asked
Center to identify the destination for 80,600 cubic yards of soil material. AR 19570. The previously submitted plans showed 80,600
cubic yards of cut soil, 7,000 cubic yards filled, and 73,600 cubic yards
exported offsite. AR 19570. The Permit application should document all
material imported or exported, not the delta, and needed to clarify if any cut
soil was worked onsite. AR 19570.
On August 19, 2021,
Center submitted an updated traffic control plan, Plan B2 grading plan, and
responses to City comments. AR 19583,
19585. It also promised to upload the
SWPPP when ready, likely the next Monday.
AR 19583, 19585. On August 25, the
City replied it still did not have the SWPPP or ECP and added a couple of new
comments on the grading plan. AR 17197, 19582.
Also on August 25, 2021,
the City issued a Notice of Breach. AR
17656. The Settlement Agreement permits
the City Manager to determine if Center is making substantive progress toward
completing Plan B. AR 17656. Center failed to provide all the necessary
application materials to obtain
a grading permit to commence work on Plan B.
AR 17656. The City informed Center
that the City Manager was selecting a contractor to proceed with Plan B per
Resolution No. 12255. AR 17656. The City gave Center a five-day opportunity
to cure its breach. AR 17656.
On August 30, 2021,
Center submitted an updated SWPPP and responses to City comments, revised B2
Plan grading plans, and other plans. AR
19587-88. The next day, City asserted that
the submission did not respond to its previous SWPPP comments. AR 19587.
On September 10, 2021, the City advised that the SWPPP still had
issues. AR 19590. After a response from Center on September 20,
the City gave one more day to submit an appropriate SWPPP and ECP “before the
flood gates open up.” AR 19592. On September 23, 2021, Center submitted
the rest of the documentation required
for the Permit. AR 17660.
On October 5, 2021, the
City confirmed that it had “what we need for now”. AR 19607.
6. The October 13, 2021 Notice of
Default
On October 13, 2021, the
City issued a NOD on the Settlement Agreement.
AR 17660. The NOD stated that the
City had given Center a five-day cure period after the Notice of Breach, which
ended on August 31, 2021. AR 17657,
17660. Center failed to submit all
documentation required for grading permits until September 23, 2021. AR 17657, 17660. Discussion between counsel resulted in
Center’s assurance that it would provide a payment schedule demonstrating its
ability to pay its proposed contractor for completing Blan B. Despite written assurance that this
information would be forthcoming soon, there was a delay of more than a month with
no further communication. AR 17660. As a result, the City was exercising its
right under the Settlement Agreement to assume control of completion of Plan
B. AR 17658, 17661. The NOD ordered Center to take no further
action regarding Plan B. AR 17661.
On October 19, 2021,
Center responded to the NOD. AR 17662. Since June 18, 2021, Center has constantly submitted
new plans in response to City comments.
AR 17763. When Center resubmitted
grading plans on August 26 and 30 and September 21, the City delayed its review
and failed to timely process the Permit application. AR 17763.
Even the NOD acknowledges that the application was complete on September
23, and yet the City had not issued the Permit.
AR 17763. Center should not be
held at fault when the City’s actions delayed Center’s attempt to remediate the
slope. AR 17763.
Center noted that the
City had entered the Property and changed the locks and cited the Settlement
Agreement’s provision that the City could intervene and abate the nuisance if
Plan B was not “underway.” AR
17664. Given Center’s Permit applications,
the Project was underway. AR 17664. Center asked the City to approve the Permit
and refrain from seizing control of the Property and implementing Plan B. AR 17664.
7. The City’s Abatement
On December 17, 2021, the
City entered a maintenance agreement with C.A. Rasmussen, Inc. (“Rasmussen”)
for winterization measures. AR
19981-82. Rasmussen then began discussions
to enter a design and build contract for the Good Views Abatement Project
(“GAP”) to permanently remediate the Property at a cost not to exceed $12
million. AR 19982. The City entered a contract with Rasmussen and,
on January 21, 2022, issued a Notice to Proceed with the GAP. AR 19125-26.
When the City began the hillside
stabilization, it tried to use the Center’s construction plans. AR 15963.
However, those plans did not sufficiently incorporate the relevant
geotechnical recommendations. AR 15963. Center’s plans for retaining walls also
applied inappropriate assumptions about lateral earth pressure distribution. AR 15963.
After consultation with the City’s contractor revealed other problems,
the City had to abandon Center’s plans and make a new plan. AR 15964.
On February 4, 2022, Rasmussen
submitted a detailed processing, construction, and hillside stabilization
schedule. AR 15980-85. The City returned the submittal and informed Rasmussen
that the baseline schedule must reflect the schedule in the contract, which was
205 days. AR 15980.
From May 2021 through
March 2023, the City recorded several liens against the Property to reflect
over $10 million spent by the City through December 31, 2022. AR 17705-07, 17889-90, 18375-76, 18391-92.
On June 29, 2023, Rasmussen
recorded notice of the GAP’s completion.
AR 16962-64.
8. Center’s Notice of Default for the Development
Agreement
On April 4, 2022, Center
sent the City a NOD on the Development Agreement. AR 17672.
The Development Agreement required the City to expeditiously process any
ministerial approvals and discretionary actions and yet the City failed to do
so. AR 17672-73. Center submitted application materials on
June 18, 2021, but the City did not comment until June 30 and July 14. AR 17673.
Center promptly responded to the Jun 30 and July 14 comments. AR 17673.
When the City provided comments on September 10, 2021, Center responded with
requested materials on September 21. AR
17673. Yet, the City was silent about Permit
approval. AR 17673.
On October 4, 2021,
Center asked about the status of the Permit.
AR 17673. The City confirmed the
next day that it had everything it needed, but it still did not issue the Permit. AR 17673.
When the SOS case was filed, the City failed to cooperate with
Center in defending the lawsuit as the Development Agreement requires. AR 17673-74.
Center demanded that the City cure these defaults or it would resort to
the courts. AR 17674.
After a few exchanged
letters, the City responded on May 13, 2022.
AR 17685. The City noted that since
the Development Agreement was not in effect until August 16, 2021, nothing
occurring beforehand could constitute a breach.
AR 17685. The City stated that
Center did not file a Permit application on June 18, 2021 because it was incomplete,
and that Center did not submit a complete application until August 19, 2021,
and only after the City Attorney emailed Center on August 9 and 10, 2021. AR 17685-86.
The City alleged that Center took a long time between submissions whereas
the City provided comments the next day.
AR 17686. A series of
back-and-forth emails followed until Center addressed all issues. AR 17686.
In addition, on August
25, 2021 the City sent a NOD for the Settlement Agreement with the opportunity
to cure by August 31, 2021. AR 17686. Even after this deadline passed, the City
exerted every reasonable effort for Center to obtain the Permit. AR 17686.
Center did not submit the necessary paperwork until September 23, 2021,
long after the cure period ended. AR
17686.
The City also cited the
MPMC and the Building Code to calculate when the Permit application
expired. AR 17686. If Center was correct and the application was
complete on June 18, 2021, it expired on December 20, 2021. AR 17686.
If the City was correct and the application was complete on September 23,
2021, it expired on March 18, 2022. AR
17686. There was no longer an active
permit application, and the City cannot issue a permit without one. AR 17686.
9. The Eminent Domain Case
On October 5, 2022, the
City Council adopted Resolution No. 2022-R80, which identified the taking of
the Property and all structures thereon as necessary to complete and maintain
the GAP to protect the public health and safety. AR 18371, 18373.
On November 18, 2022,
while Rasmussen worked on the GAP, the City filed an eminent domain action, City
of Monterrey Park v. Center Int’l Investments, Inc. et al., (the “Eminent
Domain” case), Case No. 22STCV36603, to take permanent possession of the
Property. AR 20271, 20274-75.
On February 21, 2023,
the court in the Eminent Domain case granted the City’s motion for an order of
pre-judgment possession of the Property.
AR 20302-03. The court contrasted
the Property’s appraised value of $6.4 million against the City’s $8,355,236.16
liens against the Property. AR 20306. As a result of this differenct, the court
concluded that the City only needed to post a $1,000 deposit with the State
Treasury pursuant to CCP section 1255.410(a).
AR 20303, 20308.
The court judicially
notices a Department 56 minute order dated August 31, 2023 stating that the
Eminent Domain case is set for trial on April 23, 2024.
E. Analysis
Petitioner Center seeks a
mandamus writ compelling the City to issue the Permit and all future Project-related
entitlements, as sell as setting aside Measure JJ. The City contends that (1) the City’s disapproval
of the Project, which met all objective standards, violated the HAA because it
did not timely process the Permit application and make the necessary findings
required by section 65589.5(j)(1), (2) the City breached the Development
Agreement by not timely processing the Permit application, (3) the City
violated the MPMC by not processing the Permit application for ministerial
approval, and (4) Measure JJ violates the HCA, and is preempted and void,
because it reduces the intensity of the residential use permitted on the
Project site from 16/1-30 units per acre to 0-8 per acre.
The City responds that
(1) the court in the Eminent Domain case has ordered that the City obtain
possession of the Property and Center cannot show that it can obtain a grading
permit for property it does not possess, (2) the City has finished abatement of
the Property, rendering the Permit application moot, (3) the City cannot be
compelled to issue the Permit based on an expired application, (4) Center
failed to exhaust its administrative remedies, and (5) Center failed to timely
file its Petition.[4]
The court need only
address the City’s procedural and non-merits defenses and need not address the
merits of Center’s claims.
1. The Center’s Permit Application is Not
Mooted by the City’s Completion of the GAP
The
City argues that Center’s Permit application is mooted by the City’s completion
of the GAP to stabilize the hillside. Opp. at 15-16.
Center’s
Permit application was based on grading and construction plans for the
unimproved Property. AR 290–98.
Center submitted plans, schedules, certifications, calculations, site
analysis, and management practices specific to the conditions of the Project site
as it was in August 2021 in support of constructing retaining walls and other
features to permanently stabilize the hillside.
AR 308.
On
October 13, 2021, the City issued a NOD on the Settlement Agreement and the
City exercised its contractual right to assume control over completion of Plan
B. AR 17658, 17661. On December 17, 2021, the City entered a
maintenance agreement with Rasmussen, subsequently entered into a contract with
Rasmussen to permanently remediate the Property at a cost not to exceed $12
million and issued a Notice to Proceed to Rasmussen on January 21, 2022 to
begin the GAP. AR 19982, 19125-26. From May 2021 through March 2023, the City
recorded several liens against the Property to reflect over $10 million it
spent on the GAP. AR 17705-07, 17889-90,
18375-76, 18391-92. On June 29, 2023, Rasmussen
recorded Notice of the GAP’s completion.
AR 16962-64.
The
City argues that, now that the GAP is complete, the Permit application’s plans,
schedules, and other elements are irrelevant to the Property’s current
condition. Center’s FAP, filed in August
2022, acknowledges that the City’s construction was resulting in “ongoing
physical change to the Site.” FAP, ¶¶ 2, 3.
Any grading permit application must be substantially, if not completely,
submitted anew to account for the change of conditions at the site and Center
will again have to comply with the technical requirements for the new grading
permit. Center’s mandamus claim cannot
be granted under these circumstances. Opp.
at 15-16.
Center replies that “[t]he pivotal question
in determining if a case is moot is…whether the court can grant the plaintiff
any effectual relief.” Ruegg & Ellsworth v. City of Berkeley,
(2023) 89 Cal.App.5th 258, 271 (citation omitted). The City’s completion of slope stabilization
does not moot Center’s the requested mandamus requiring the City to grant the
Permit because the Permit application does not exclusively relate to
remediation of the slopes on the Property. The Permit is for both slope
stabilization and Center’s planned construction of single-family homes. AR 16972-88. Despite the City’s assertion that it has
remediated the slope, the Permit would provide Center the ability to grade the
Property for the planned housing construction. Reply at 8-9.
Center adds that the relief for the first
cause of action’s claim for violation of the HAA can include more relief than granting
the Permit. “[T]he HAA authorizes a
trial court that finds a violation of the statute with respect to approval of a
project or conditions imposed on it to compel compliance, retain jurisdiction
to ensure enforcement of its orders and impose fines for noncompliance.” Ruegg & Ellsworth v. City of Berkeley,
supra, 89 Cal.App.5th at 271-72. Reply at 9.
Even if Center would be required to revise
its Permit application to account for the City’s slope remediation, this does
not thwart the court’s ability to order the City to process and approve a
revised Permit application in accordance with the HAA, MPMC and Development Agreement. The City’s
argument that performance of a portion of the permitted construction moots the
application would effectively mean that any change in circumstances or lapse in
time that may impact an application during the pendency of a lawsuit would
render it moot. The City’s argument also misunderstands the thrust of the
Petition, which is that the City should have approved the Permit application
when it was deemed complete, and that the City violated that HAA, the
Development Agreement, and MPMC by
intentionally letting the application languish. Reply at 9.
Without subscribing to Center’s arguments
that the scope of relief for a violation of the HAA needs to be broad in this
case and that the City’s delay in processing the Permit application violates the
HAA, Development Agreement, and MPMC, the fact is that the Permit application
is for both hillside stabilization and the planned construction of
single-family homes. The City has
completed the former but not the latter.
The City makes no showing that partial completion of the grading that
would be authorized by the Permit somehow negates the remaining portion. The FAP’s causes at issue are not mooted by
the City’s performance of the GAP.
2. The Statute of Limitations Did Not
Pass Before the First and Eight Causes of Action Were Made
The City notes that the FAP’s first (HAA
violation) and eighth (HCA violation)
mandamus causes of action seek relief under CCP
section 1094.5. Judicial
review of any decision of a local agency or of any commission, board, officer
or agent thereof, may be had pursuant to CCP section
1094.5 only if the petition for writ of mandate is filed not later than the 90th day following the date
on which the decision becomes final. CCP
§1094.6. CCP § 1094.6 applies to final decisions issued by
public officials. Farmer
v. City of Inglewood,
(1982) 134 Cal.App.3d 130. A writ
regarding an administrative order is subject to the 90-day time limit of CCP
section 1094.6. Holden v. Los Angeles City Ethics
Com., (2006) 137
Cal.App.4th 1274. Opp. at 19.
The MPMC
also establishes a 90-day statute of limitations for the City’s final
decisions. “Notwithstanding any other
provision of law, Section 1094.6 of the
California Code of Civil Procedure shall apply to any decision of the
city, or of any commission, board, officer or agent of the city, which is
subject to review pursuant to Code of
Civil Procedure Section 1094.5.” MPMC §1.16.010. See also MPMC § 3.12.030 (final decision of city
council, city planning commission, or city official subject to 90-day
limitation of CCP§1094.5) Opp. at 19.
The City argues that the FAP suggests that
the 90-day time limit accrued no later than December 17, 2021 because the FAP
alleges that “[o]n or about December 17, 2021, the City Attorney informed
counsel for Center that the City would not be issuing the Permit as applied
for.” FAP, ¶126. This allegation assumes
that the City Attorney can render a final decision regarding a grading permit
which he cannot under the Building Code. Arguably, the 90-day accrual began on October
5, 2021 when Center alleges the complete grading permit packet was submitted to
the City, but no permit was issued. The City’s
October 13, 2021 NOD to Center also clearly established that the Permit was not
going to be issued. Regardless of which
date is used, the 90-day limitations period expired before any mandamus claim was
filed. Opp. at 20.
The City adds that the eighth cause of action for violation of the HCA
is a new cause of action not pled in the Petition. The FAP alleged a violation of the HCA was
filed on September 30, 2022, and any conceivable accrual of this cause of action also has long since passed. Accordingly, the mandamus claims are time-barred
pursuant to CCP section 1094.6(b). Opp. at 20.[5]
The City is incorrect. The 90-day statute of limitations identified
in CCP section 1094.6 is for
administrative mandamus for local agency decisions reviewed under CCP section 1094.5. CCP §1094.6(a). To be reviewable under CCP
section 1094.5, an agency’s action must be an exercise of an adjudicatory or
quasi-judicial function. The order or decision must be final after a hearing
required by law at which evidence is required to be taken, and discretion is
vested in the decision-maker. CCP §1094.5(a). Such a decision requires that the agency
determine the facts in relation to specific property rights or interests in an
adjudicative fashion, and that it apply existing law, rules, or policy to the
facts. Cal.
Administrative Mandamus §§1.1–1.4 (3d ed
Cal CEB); see Horn v. County of Ventura, (1979) 24
Cal.3d 605, 613.
The FAP’s first and eighth causes of action
seek review for both traditional and administrative mandamus. Agency decisions
under the HAA are reviewed as administrative mandamus. §65589.5(m). This is true whether or not there was a
hearing required by law. Therefore, the
first cause of action is governed by the 90-day limitation period of CCP
section 1094.6.
The City argues that the 90-day period
accrued either on October 5, 2021, when the complete Permit packet was
submitted and no Permit was issued, or with the October 13, 2021 NOD. Opp. at 20.
Center argues that the 90-day period began when the Permit application
expired, which was the final action on a housing development project. See §65589.5(m). Pet. Op. Br. at 14.
None of these
dates matter. CCP section 1094.6 states
that where the agency is required to issue a written decision or findings, it
is not final until mailed by first class mail, including a certificate of
mailing, to the party seeking the writ.
CCP §1094.6(b). The City has not shown
that it mailed any findings required by section 65589.5(j)(1) for denial of a housing
development project complies with applicable objective general plan, zoning,
and subdivision standards.
Additionally, the local agency shall provide notice that judicial review
must be sought within the 90-day period.
CCP §1094.6(f). The City has not
provided Center with written notice of the 90-period to file for judicial
review. Therefore, the 90-day clock
never started for the first cause of action (violation of the HAA) before the
Petition was filed.
The HCA does not provide for a particular
form of mandamus review. If a petition
seeks review of a quasi-legislative action, such as the adoption of
regulations, it is properly viewed as a petition for traditional
mandamus. Del Mar Terrace
Conservancy, Inc. v City Council, (1992)
10 Cal.App.4th 712, 725. Center is
alleging that the voters’ adoption of Measure JJ, and the City’s subsequent
enactment, violated the HCA. This is an
as-applied challenge to Measure JJ. The
adoption of it was quasi-legislative in nature and includes the “formulation of
a rule to be applied in all future cases.” S. Cal. Cement Masons Joint
Apprenticeship Committee v. Cal. Apprenticeship Council, (2013) 213 Cal.App.4th 1531, 1541.
Therefore, traditional mandamus applies to the eighth cause of action.
The three- or four-year catch-all statute of
limitations in CCP section 338(a) applies
to traditional mandamus unless a more specific statute applies. See Conti
v. Bd. of Civil Serv. Comm’rs, (1969) 1 Cal.3d 351, 357, n. 3. The HCA
does not contain a statute of limitations and CCP section 338 applies. The City’s electorate approved Measure JJ on
November 3, 2020. Even under the shorter three-year limitation period in CCP
section 338(a), the FAP’s HCA claim, filed
on August 31, 2022, is timely.
3. The Expiration of the Permit
Application Does Not Affect Center’s Right to Compel
Issuance of the Permit
The City notes that Center alleges that its Permit
application was complete on October 5, 2021.
“An application for a
permit for any proposed work is deemed expired 180 days after the completion of
any submittal review unless a permit has been issued.” Building Code §105.3.2.
Based
upon the FAP’s allegations, Center’s Permit
application expired 180 days from the October 5, 2021 date the application was
complete, which was April 3, 2022. Center acknowledges this timing in both its
opening brief and the FAP. Pet. Op. Br.
at 14, n. 15; FAP, ¶207. Opp. at 16.
The
City has no legal authority to issue a permit without an active application. [M]andate does not lie when the
respondent no longer has the legal authority to discharge the alleged duty
because the time for doing so, as specified by statute or ordinance, has
expired.” California Assn. for Health Services at Home
v. State Dept. of Health Services, (2007) 148 Cal. App. 4th 696, 709 (court
could provide retroactive relief of raising historical Medi-Cal reimbursement
rates). With no active Permit application, the court cannot mandate the City to do
something which it has no authority to do. Opp. at 16.
Center
does not directly respond to this contention.
It agrees that “[a]n application for a permit for any proposed
work is deemed expired 180 days after the completion of any submittal review
unless a permit has been issued.” MPMC §105.3.2.
The City did not inform Center until May
16, 2022 that the Permit application had expired as of March 18, 2022 – 180
days after the most recent resubmission of the application. AR 17686. Center contends that the City’s March 18, 2022
date is incorrect. Per MPMC section
105.3.2, if the Permit application legally expired, it did so on April 4, 2022
because the expiration period is calculated from the October 5, 2021 date the
application was deemed complete. Pet.
Op. Br. at 14.
Center concludes that, since the Permit
application expired on April 4, 2022, it was required to bring this action
within 90 days of the expiration date – the final action on a housing
development project. §65589.5(m). The Petition, including allegations related
to HAA violations, was filed on May 3, 2022, within 30 days of the April 4,
2022 date on which the Permit application expired and well within the statute
of limitations. Pet. Op. Br. at 14.
The City fails to explain why Center should
be foreclosed from seeking mandamus to compel the City to issue the Permit
simply because the Permit application expired.
Center seeks to compel the City to perform an act which Center contends
the City should have performed within the 180 period of MPMC section 105.3.2. The April 4, 2022 expiration of the Permit
application affects the City’s authority to act but does not affect Center’s
right to seek mandamus to compel the City to issue the Permit based on its
failure to do so. The only limitation on
the Center’s ability to obtain relief is the statute of limitations, which did
even accrue for administrative mandamus and therefore has not passed.
4. Center
Did Not Fail to Exhaust Its Administrative Remedies
The City argues that Center failed to appeal
the denial of its Permit application. A
writ of mandate will only issue when the petitioner has no plain, speedy, or
adequate remedy at law. CCP §1086. As a
general rule, a court will not issue a writ of mandate unless a petitioner has
first exhausted its available administrative remedies. See, e.g., Alta Loma School
Dist. v. San Bernardino County Com. On School Dist. Reorganization, (1981)
124 Cal.App.3d 542, 554. Under this
rule, an administrative remedy is exhausted only upon termination of all
available, non-duplicative administrative review procedures. Coachella Valley Mosquito & Vector
Control Dist. v. California Public Employment Relations Bd., (2005) 35
Cal.4th 1072, 1080.
The exhaustion doctrine has been described
as “a jurisdictional prerequisite to resort to the courts.” Abelleira v. District Court of Appeal,
(1941) 17 Cal.2d 280, 293. The
exhaustion doctrine contemplates that the real issues in controversy be
presented to the administrative body, which must be given the opportunity to
apply its special expertise to correct any errors and reach a final decision,
thereby saving the already overworked courts from intervening into an
administrative dispute unless absolutely necessary. Farmers Ins. Exchange v. Superior Court,
(1992) 2 Cal.4th 377, 391.
There are
exceptions to the exhaustion doctrine; exhaustion is excused when an
administrative remedy is unavailable, is inadequate, or it would be futile to
pursue it. McAllister v. County of Monterrey, (2007) 147 Cal.App.4th.
253, 275. Other exceptions include "situations where the agency
indulges in unreasonable delay...when the subject matter lies outside the
administrative agency's jurisdiction, [or] when pursuit of an administrative
remedy would result in irreparable harm...." Ibid; Green v. City of Oceanside,
(1987) 194 Cal.App.3d 212, 222.
The City argues that Building Code section 105.3.2 provides an exclusive administrative
remedy for denial of any building permit, including a grading permit. An appeal
from denial of a building permit must be made to the City’s Planning
Commission, acting as the Construction Appeals Board, within 20 days of the
denial. MPMC
§16.01.040. The FAP fails to allege compliance with Building
Code section 105.3.2. Opp. at 17.
The City notes that Center’s moving papers
argue that it did not fail to exhaust its administrative appeal remedy because
“the City never provided Center with a final determination or formal notice of
its unilateral determination not to process the Permit application.” Pet. Op. Br at 13. Center ignores the City’s October 13, 2021 NOD
wherein Center was informed as follows: “Because of Center’s default, the City
is assuming control over completing Plan B in accordance with the Settlement Agreement. Center is to take no
further action regarding Plan B.” AR 17660-61. Because Center’s Permit application was based
on the same Plan B hillside abatement taken over by the City, the Permit had
not been issued to Center, and the City directed Center to take no further action regarding the hillside stabilization,
the NOD amounted to a final determination that the City was not going to
process the Permit application. Center
had no reasonable basis to think otherwise.
The NOD was a final determination and formal notice to Center that the Permit
would not be issued and therefore was denied.[6] Center does not dispute that it failed to
appeal that decision. Opp. at 17-18.
Center replies that the City wrongly relies
on the October 13, 2021 NOD as its final determination on the Permit
application such that it would qualify as the “rendering of the decision”
required by MPMC section 1.10.020 for
appeal, or as “orders, decisions or
determinations made by the Building Official” from which to appeal as provided by
MPMC section 113.1. The NOD was issued for a breach of the
Settlement Agreement, and merely alleges that Center was required to obtain the
Permit by August 1, 2021 and did not submit a complete Permit application until
September 23, 2021. AR 17660.
Reply at 10.
The City suggests that Center should have
inferred from the NOD, coupled with the facts that the Permit had not been
issued and that the City was taking over hillside stabilization, that the
Permit application had been rejected.
Yet, this the type of inferential step that was rejected in Martino v. Concord Community Hosp. Dist.,
(1965) 233 Cal.App.2d 51, 56, where the court determined that the
administrative hearing procedure provided for in the defendant’s bylaws was not
available to the doctor because the doctor’s application for staff privileges
was “deferred” rather than being “rejected or denied.” Similarly, in Farmer v. City of Inglewood, (“Farmer”)
(1982) 134 Cal.App.3d 130, 137-38, the court determined administrative remedies
were not available because “the notice of final action only made reference to
charges rather than the requisite grounds” such that the triggering
“prerequisite to starting the time period within which to request an appeal
never was satisfied.” Pet. Op. Br. at
13; Reply at 10-11.
In fact, this inferential step is
contradicted by the City’s position that the Permit application expired. AR
17686. For a permit application to
expire, there must be an active application on file. If the NOD was intended to be a final
determination on the Permit application, the application would be considered
denied and there would be no open application to expire. However, the administrative
record and the City’s opposition show that the City believes the Permit
application expired on March 18, 2022. AR 17686. Application expiration and denial are mutually
exclusive. Reply at 11.[7]
The court agrees. To compel Center to exhaust its
administrative remedies through an appeal, the City must provide clear notice
of denial. While it may seem obvious that
the City intended to deny the Permit from the fact that it was taking over the
Property to perform the GAP, Center was entitled to a clear statement of the denial
in order to trigger the appeal deadlines.
Additionally, as discussed ante, the City’s performance of the
GAP does not moot Center’s rights to the rest of the grading sought in the
Permit application. The City’s failure to expressly and directly inform Center
that its Permit application had been denied is an insufficient communication to
trigger an administrative appeal. See
Farmer, supra, 134
Cal.App.3d at 137-38.[8]
As such, there was no administrative remedy
available for Center to pursue, and its claims are not barred by the doctrine
of exhaustion of administrative remedies.
5. The City has Court-Ordered Possession
of the Property from the Eminent Domain Case and
the Mandamus Claims Should Be Stayed
Although Center
disputes its default under the Settlement Agreement, it does not dispute that
the City now possesses the Property based on a court ruling. On February 21, 2023, the court in the Eminent
Domain case granted the City’s motion for an order of pre-judgment possession
of the Property. AR 20302-03. Trial of the Eminent Domain case is set for
April 23, 2024.
Although there is a pre-judgment
ruling giving the City possession of the Property, Center is contesting both
the City’s right to eminent domain and the proper amount of compensation. The City recognizes that it is technically
possible that the Eminent Domain court could reverse its decision on the City’s
exercise of its eminent domain power for the Property and argues that such
reversals are rare and there is no good reason to believe it will happen. The City contends that determining the fair
market value of the Property is realistically the only remaining issue. Opp. at 14.
The court
essentially agrees, particularly because the City may well not owe Center any
substantial amount of compensation. In
its pre-trial ruling, the Eminent Domain court contrasted the Property’s
appraised value of $6.4 million against the City’s $8,355,236.16 in liens
against the Property. AR 20306. The court concluded that the City only needed
to post a $1,000 deposit with the State Treasury pursuant to CCP section
1255.410(a). AR 20303, 20308. The court’s conclusion that Center is likely
to recover little compensation makes completion of the City’s exercise of eminent
domain more likely.
As the City argues
(Opp. at 15), completion of the Eminent Domain case directly impacts any
issuance of the Permit. The City will
own the Property and Center will have no right or need for a permit to grade
Property it does not own. Nor could the court
issue a mandate for the City to issue a grading (or any other building) permit.
The FAP causes at issue will
be mooted.
Center replies that the City is asking the court
to allow the City to profit from its wrongdoing in failing to process and
approve Center’s Permit application. Civil Code §3517 (“No one can take advantage
of his own wrong.”). The City’s argument about pre-judgment possession fails to
acknowledge that it cannot equitably rely on mootness to avoid the consequences
of failing to abide by statutory and contractual mandates. Reply at 8.
This argument is a non-sequitur. The court has made no assessment of the
merits of Center’s claims, but if, arguendo, the City violated its
statutory and contractual duties by delaying issuance of the Permit, that has
nothing to do with the City’s right to condemn the Property through eminent
domain. Eminent domain serves a public
purpose which has nothing to do with development permits.
Center also argues that, while the City has pre-judgment
possession of the Property pursuant to CCP section 1255.410, there is no final
judgment in the Eminent Domain case and the court’s pre-judgment’s decision is
subject to reversal. The Legislative Committee Comments to CCP section 1255.410 expressly provide that “it
should be noted that the determination of the plaintiff’s right to take the
property by eminent domain is preliminary only. The granting of an order for
possession does not prejudice the defendant’s right to demur to the complaint
or to contest the taking.” The Eminent Domain Law, (Dec. 1975) 13 Cal.
Law Revision Com. Rep. (1976) pp. 1001–12. Given that this prejudgment possession is
preliminary only, it does not moot Center’s mandamus claims. Reply at 8.
The
court agrees that the lack of a final judgment in the Eminent Domain case means
that the mandamus claims are not yet mooted.
However, Center cannot dispute that its claims will be mooted by a final
judgment awarding the Property to the City, and that the City’s completion of
eminent domain over the Property is likely.
The proper course, therefore, is to stay the mandamus claims until a
final judgment or dismissal in the Eminent Domain case. Center also cannot
reasonably argue that it will be harmed by such a stay, given that it cannot
make any use of the Permit while the City possesses the Property.
F. Conclusion
The mandamus claims (first, six, seventh, and eighth causes of
action) are ordered stayed pending judgment or dismissal of the Eminent Domain
case. If the City does not obtain
ownership of the Property, the parties will be limited to the undecided claims
on the merits when the stay is lifted. The
court will discuss with the parties whether, in the interim, the court should
lift the stay on the second through fifth causes of action and transfer them to
Dept. 1 for reassignment to an I/C court.
[1]
Both parties violated the court’s order on oversized briefs. The court’s September 15, 2022 trial setting
order required 15/15/10 page limits. On
June 16, 2023, the parties stipulated to oversize page limits of 25/20/15. Center actually filed a 26-page opening brief
and a 15-page reply, and the City filed a 28-page opposition. Additionally, the footnotes in both
parties’ briefs are smaller than the
12-point type required by CRC 2.104. The
court has exercised its discretion to read and consider only the first 25 pages
of Center’s opening brief, the first 20 pages of the City’s opposition, and
none of either party’s footnotes.
[2] Center
requests judicial notice of (1) the State Legislative Analyst Office’s Considering
Changes to Streamline Local Housing Approvals, (May 2016) (Pet. RJN Ex. A);
(2) the State Legislative Analyst Office’s California’s High Housing Costs: Causes and
Consequences, (March 2015) (Pet. RJN Ex. B); (3) Resolution No. 12179,
approved by the City Council on July 1, 2020 (Pet. RJN Ex. C); (4) Department
of Housing and Community Development’s (“HCD”) Letter of Support and Technical
Assistance to the City of Claremont, dated June 23, 2022 (Pet. RJN Ex. D); and
(5) HCD’s Guidance on the HAA, dated September 2020 (Pet. RJN Ex. E). With the exception of the letter of support
(Pet. RJN Ex. D), the requests are granted.
Evid. Code §§ 452(b), (c). Pet.
RJN Ex. D is not an official act, and the request is denied.
The City
requests judicial notice of (1) sections of the Monterrey Park Municipal Code
(“MPMC”) (Opp. RJN Ex. A) and (2) sections of the Building Code (Opp. RJN Ex.
B). The requests are granted. Evid. Code §452(b).
[4] In
the portion of the City’s opposition not considered due to page limit
violation, the City contends that it was entitled to take possession of the
Property to perform the GAP under the Settlement Agreement, the City has
authority to abate an imminent threat to public safety pursuant to its police
powers, it is immune to Center’s claims pursuant to section 8655 and 866, the
HAA is inapplicable because the emergency abatement of an imminent threat takes
precedence over Center’s development rights, and Center supported the LUE
change from high to low density that became Measure JJ.
[5]
The City does not challenge the timeliness of the FAP’s sixth and seventh
causes of action.
[6] The NOD was issued by the City Manager, who
can step into the shoes of Building Official by virtue of the authority to,
“control, order and give directions to all heads of departments, subordinate
officers and employees of the city,” and “exercise control over all departments
of the city government and over all appointive officers and employees thereof.”
MPMC § 2.08.070(2), (4).
[7] Center
also notes that a local agency disapproves a housing development project
when it votes on a housing development project application, including any
required land use approvals or entitlements necessary for the issuance of a
building permit, and disapproves it.
§65589.5(h)(6)(A). None of
these three instances of denial occurred for the Permit application prior to
(or even after) the Notice of Default. Reply at 11.
[8] Center’s
contention that any appeal would be futile is insufficiently supported. Pet. Op. Br. at 14.