Judge: James C. Chalfant, Case: 24STCP00994, Date: 2025-02-27 Tentative Ruling

Case Number: 24STCP00994    Hearing Date: February 27, 2025    Dept: 85

The Santa Monica Properties court concluded, however, that section 1805(e)’s list is not a freestanding basis for adjusting rent.  Instead, the list contains no more than indicators of the landlord’s comparative return.  Id. at 752.  Where the reduction in services is minor, such as the spa service, no rent decrease may be ordered without evidence that it resulted in excessive rent or an unjust return.  Ibid.  While the Board’s Regulation 4200(a) recognized that under the RCL rent decreases are not designed to provide a precise correlation between rental value of a service reduction and a rent decrease, this does not mean that no correlation is required.  Here, there was no evidence that the minor service reduction resulted in excessive tenant rent.  Id. at 753.  

The Santa Monica Properties court further acknowledged that Ocean Park Associates v. Santa Monica Rent Control Board, (“Ocean Park”) (2004) 114 Cal.App.4th 1050, 1069-70, upheld a rent reduction for a two-year loss of common facilities (recreation room, sauna, spa, laundry, security gates, garden area, mail room, lobby, and stairwell) during construction.  Id. at 754-55.  The court distinguished Ocean Park as involving whether substantial evidence existed to justify the rent reduction, not a case whether section 1805(e) authorizes a rent reduction for any reduction in services.  In essence, the Ocean Park evidence could be presumed to support a conclusion of unfair return whereas the minor reduction in services in Santa Monica Properties could not.  Ibid.

The Santa Monica Properties court concluded that a rent reduction may be made, both as a matter of municipal police power, and under the RCL, only where it is reasonably calculated to eliminate excessive rents and provide the landlord with a just return. Id. at 752.  It further concluded that, while an imprecise correlation between a condition or decrease in service and a decrease in rent is permitted, there must be some evidence supporting the reduction.  Id. at 753.  The Santa Monica Properties court also suggested that this is a matter of evidentiary presumption.  A major violation of habitability requirements, such as in Ocean Park, will be presumed to have an impact on habitability and either tenant rent or landlord return.  Once the violation is shown, only rough approximation of the according rent reduction is required.  On the other hand, minor defects or loss of service will not, and express evidence will have to be presented to justify a rent reduction.  Id. at 755.

E. Statement of Facts

1. Background

Princeton purchased the Property in 2019.  AR 59.  The Property is located at 1132-1142 Princeton Street, in the City, is governed by the City’s RCL, and totals 24 units.  AR 319-20.  The premises consists of two separate 12-unit buildings that face each other, with a common area courtyard in the middle, totaling 24 residential rental units.  AR 319-20.  Real Party Moallef leased 1138 Princeton, Unit B, in September 2012.  AR 168.  By August 2023, her maximum allowable rent was $2,475.  See AR 36.

In December 2022, permits were finalized to construct ten Accessory Dwelling Unit (ADUs) behind the Premises.  AR 139-151.  As part of constructing the ADUs, the garages and laundry room were permanently removed from the Premises (AR 394) and some areas were temporarily blocked-off due to the construction.  AR 223.   

Moallef made a reasonable accommodation request demanding a $1,500 to $2,000 per month reduction for her loss of the garage and laundry, which Princeton denied as unreasonable on May 23, 2022.  AR 167.  Princeton’s response noted that the onsite laundry room removed in January 2023 was not handicap accessible for a wheelchair and that there were laundry facilities .5 miles away (AR 167), as well as laundry pick-up services for as little as $1.25 per pound. AR 312-16.

2. The Hearing

Moallef filed her Petition for Rent Decrease on January 30, 2023.  AR 45-54.  The petition included a Representative Authorization designation for Moallef’s daughter, Azita Moallef (“Azita”) to appear for her at the hearing.  AR 50.

The hearing on Moallef’s petition was conducted on March 20, 2023.  AR 2.  The witnesses were Board investigator Daniella Wodnicki, Princeton’s agent Jorge Valesquez, Moallef, and Azita, with Azita providing most of their testimony.  AR 184-299.

Azita testified that Moallef is now washing all items in the sink.  AR 229.  She is “obsessive compulsive in cleanliness” and wants to do her own laundry.  AR 229-30.   She does not want to send it out and would never use a laundry service.  AR 231.  Azita testified that “there is no way we would have the laundromat pick up and drop off or she herself [Moallef] go the laundromat.”  AR 233.  

Moallef’s garage space was garage number 21.  AR 18.  Princeton submitted evidence that nearby parking was $150 (AR 459) to $206 (AR 469) per month.  Moallef does not drive and does not own a car.  AR 228, 262, 399.  She used the garage to store her art supplies, paintings, and picture frames.  AR 200.  Basically, it was like an art studio for her, and she locked important things in the storage she did not want anyone to see.  AR 200.

Photos of garage space 21 (AR 152-156) taken in September 2020 (AR 227) show only storage usage with no car parked.  AR 152.  Nor do the photos show any type of art studio.  AR 152-56.  Although Azita was unsure whether the photos were of her mother’s garage, she admitted that her mother used her garage only for storage.  AR 226-27.  Azita testified that Moallef would not rent a storage unit because “[Moallef] doesn’t want to pay” (AR 242) and “it’s just inconvenient.” AR 245.

Princeton argued that, since the testimony and photos showed the area was only used as storage and Moallef does not drive or have a car to park, the lower $5 to $220 range for storage should apply, or at least there should be no double-counting of parking and storage.  AR 178.

3. The Hearing Examiner’s Decision  

The Hearing Examiner’s decision was issued on August 30, 2023 (AR 1), 212 days after the petition was filed. 

As to the loss of the onsite laundry room, the Hearing Examiner noted that the removal of laundry services constitutes a decrease in housing services for which a rent reduction is warranted on two grounds of RCL section 1805(e).  AR 32.  The range in Reg. 4200(f)(4) for a decrease in laundry services is between $30 to $175 per month.  AR 32.  The Hearing Examiner ordered a rent reduction of $150 per month. AR 32.

For the garage, the Hearing Examiner stated that “[t]he storage that [Moallef] alleges is lost is located inside the garage space, so both are considered together.” AR 10.  The Hearing Examiner noted that Azita credibly testified that Moallef uses the garage for storage and as an art studio.  AR 30.  She has eliminated some of those items but is storing the rest in her apartment, which makes it cluttered and limits her ability to sit and paint.  AR 30.  Moallef no longer has use of an indoor one-car parking space.  AR 30.  One factor in Reg. 4200(g)(1) and (2) favors a lower decrease in rent but the remaining factors weigh heavily in a higher decrease for parking and storage.  AR 30.  Due to her age and mobility, it would be difficult for Moallef to rent offsite storage.  AR 30.  She also needed easy access to her painting supplies.  AR 30.  As a result, the loss of the garage is the equivalent of losing a room.  AR 30.  The Hearing Examiner chose a $425 reduction based on the weight of the relevant factors from Reg. 4200(g)(1)-(2).  AR 31.[1] 

The right side-yard of the Premises was blocked during construction and a walkway/common courtyard was partially permanently removed. AR 222, 225. Moallef was granted a $150 rent reduction for loss of the courtyard. AR 34.  

The Hearing Examiner also stated:

“Regulation 4203(a)(3) …provides that if any portion of the hearing process is delayed or continued for good cause, the calculation of the total decrease for past reductions shall not include that period of delay or continuance.  ¶In this case, the first rent-due date after the petition was filed was February 1, 2023, and the effective date of the decision is October 1, 2023.  The period of past reductions is therefore February 1, 2023 through September 30, 2023 (8 months)….In this case it is inappropriate to apply Regulation 4203(a)(3) to exclude a portion of that period based on a delay or continuance for good cause.”  AR 21 (emphasis added). 

The Hearing Examiner ordered a total rent reduction of $835.  AR 36.

4. The Appeal to the Board

Princeton appealed the Hearing Examiner’s decision to the Board.  The Board initially affirmed the Hearing Examiner’s decision on October 12, 20231 (AR 345) but Princeton’s lawyer did not receive notice of that hearing.  Pet. Op. Br. at 3, n. 1.  The Board held another appeal hearing on January 11, 2024 and reaffirmed the Hearing Examiner’s decision.  AR 523.

At the October 12, 2023, Board appeal hearing, a staff attorney stated that photos of the garage showing that Moallef used it for was storage and not a studio or for parking should be disregarded because they were not in the record (AR 343), but they were in the record. AR 153-156.  The photos were marked as Exhibit 10 at the March 30, 2023 administrative hearing (AR 152-56) and admitted into evidence by the Hearing Examiner.  AR 257.

5. Traditional Mandamus Evidence

The Compliance Determination

In March 2024, Princeton requested a reinstatement of rent for the temporarily blocked-off side yard and the now smaller walkway area which was not adjudicated until July 5, 2024.  RJN Ex. 3.  

Princeton again requested the reinstatement of rent for the formerly blocked-off side yard and walkway area on August 23, 2024 which the Hearing Examiner adjudicated on September 25, 2024.  RJN Ex. 6.

Other Rent Reductions at the Premises

The monthly revenue from the Premises is approximately $67,196.  RJN Ex. 19. The expenses, including the mortgage, total $60,800, leaving $6,396 in cash flow before the temporary or permanent deductions are assessed.  RJN Ex. 19, pg. 3.  

A total of 11 rent decrease petitions have been filed regarding the Premises.  RJN Ex. 18. Princeton has lost $94,996.303 in temporary deductions, with $2,786 per month in permanent deductions, not including at least one more rent decrease petition still pending with the Board.  RJN Ex. 18.  For the ten rent adjustment petitions that have been adjudicated by the Board, the average time was 350 days.  RJN Ex. 18.  The eleventh petition, case number P2024-06428, was filed on January 11, 2024, and is still pending 306 days after filing.  RJN Ex. 18.

F. Analysis

Petitioner Princeton seeks administrative mandamus setting aside the Hearing Examiner’s decision[2] reducing Real Party Moallef’s monthly rent by $835 dollars[3] as an abuse of discretion.  Princeton also seeks traditional mandamus on the grounds that the Board systemically fails to follow (a) RCL section 1805(d)(12)’s 120-day deadline to render a final decision on a rent adjustment petition, (b) Reg. 4019’s 65-day deadline for hearing examiners to render a decision on a rent adjustment petition, and (c) Reg. 4038(c)(2)’s requirement for compliance determinations within 30 days of request. 

1. Traditional Mandamus

Under the RCL, the rules and regulations adopted by the Board shall provide for final action on any individual petition within 120 days following the date of the petition’s filing.  RCL §1805(d)(12) (RJN Ex. 4, p. 11). 

As soon as practicable after the filing of a petition, and in no event later than 60 days from the date of filing, a hearing examiner shall hold a hearing on the petition.  Reg. §4007 (RJN Ex. 5, p. 7).  Within sixty-five days after the date of the filing of the petition the hearing examiner shall render a written decision supported by findings of fact and conclusions of law.  Reg. §4019 (RJN Ex. 5, p. 10) (emphasis added).

If there is an appeal, as soon as practicable after the filing of the appeal, and in no event more than 120 days from the date of the filing of the petition, the Board shall affirm, reverse, or modify the decision of the hearing examiner.   Reg. §4024 (RJN Ex. 5, p. 11) (emphasis added).  The hearing examiner or the Board may extend the 120-day deadline for a maximum of an additional 45-days only upon a showing of good cause.  The good cause extension must be in writing and written notice of it shall be given to all the parties.”  Reg. 4039 (RJN Ex. 5, p. 15).[4]

Princeton notes that the adjudication of Moallef’s rent decrease petition took 212 days for the Hearing Examiner’s decision to issue (instead of 65) and 254 days for the decision to be final (instead of 120), clearly violating both the RCL and Regulations.   Petitioner is prejudiced by these chronic and systemic time delays as it cannot financially plan.  These time delays are systemic and not an isolated incident.   RJN Exs. 11, 12.  Pet. Op. Br. at 6-7.

A rent decrease “…will account for the past, present, and continuing reduction on which the decrease is based.   Reg. §4203 (RJN Ex. 5, p. 41).   The total value of a reduction of services or maintenance which was in effect through the date when the hearing record is closed is calculated as follows: (1) Determine the monthly of the reduced service or maintenance; (2) Multiply the monthly value of the reduction by the number of months between the first rent-due date after the rent-decrease petition was filed with the Board and the date when the decrease is to go into effect; and (3) If any portion of the hearing process is delayed or continued for good cause, the calculation of the total decrease amount for past reductions shall not include that period of delay or continuance.  Reg. §4203(a) (RJN Ex. 5, p. 41).

Princeton notes that the time delay was not deducted by the Hearing Examiner.  According to the Regulations, the Hearing Examiner’s decision should have been issued no later than 65 days after January 30, 2023, or by March 16, 2023.  The Hearing Examiner’s decision was issued on August 30, 2023 and application of Reg. 4203(a)(3) would have subtracted the eight-month delay from the rent reduction.  Clearly, application of Reg. 4203(a)(3) would have benefited Princeton.  Yet, the Hearing Examiner stated: “In this case it is inappropriate to apply Regulation 4203(a)(3) to exclude a portion of that period based on a delay or continuance for good cause.  AR 21.  The Hearing Examiner offered no reason or evidence for the delay, or why it was inappropriate to deduct the time delay when calculating the rent decrease.   Pet. Op. Br. at 7.

To reinstate a rent reduction granted in a rent adjustment petition, the landlord may request a compliance determination, where the hearing examiner “shall issue a proposed determination stating whether all or part of the decrease shall be reinstated…within 30 days after receipt of the request for compliance.”  Reg. §4038(c)(2) (RJN Ex. 5, p. 14) (emphasis added).

Princeton argues that its first compliance determination reinstated $30 but took 112 days to adjudicate.  RJN Ex 3.  The second compliance determination reinstated an additional $80 but took 33 days to adjudicate.  Neither reinstated the return of the temporarily removed side yard and the reason proffered is not supported by the evidence.  RJN Ex. 6.   Pet. Op. Br. at 8.

Princeton adds that these delays are systemic.  The Board’s response to a CPRA request produced 96 rent decrease decisions and 30 compliance determinations from 2021 through July 2024.  RJN Exs. 11, 12; Cordero-Sacks Decl., ¶¶ 8-15.  The average time for the hearing examiner to issue a decision was 250 days, clearly exceeding the 65-day deadline as well as the 120-day deadline for final Board action.[5]  RJN Ex 11.   For calendar years 2021 through 2023, all appeals taken to the Board were affirmed.  RJN Exs. 7-9.  For compliance determinations, the average time was 87.43 days instead of the required 30 days.  RJN Ex. 12.  Pet. Op. Br. at 9-10.

This systemic and pervasive disregard for deadlines in the RCL and Regulations is clearly unlawful.  The Board’s disregard of all timelines in the RCL and Regulations is prejudicial to landlords, especially where the hearing examiner disregards Reg. 4203(a)(3) and applies the rent reduction without regard for the period of delay or continuance.

Princeton notes that Santa Monica Properties, supra, 203 Cal. App. 4^th at 739, does not state to the contrary.  Pet. Op. Br. at 10. 

In addition to the holding discussed ante, Santa Monica Properties addressed the petitioner’s traditional mandate claim that the RCL imposes a mandatory duty on the [Board] to adopt specific regulations establishing administrative remedies which would give ‘teeth’ to its mandatory duty to issue a final decision within 120 days.”  Id. at 756.  The record showed that the Board violated every single time limit prescribed by the RCL and the Regulations in the petitioner’s case.  Id. at 757.  The court assumed without deciding that RCL section 1803(g) and 1805(d)(12) impose a mandatory duty on the Board to issue a final decision on a rent decrease within 120 days and that the Board could be compelled by way of a petition for writ of traditional mandate to perform this duty.  Id. at 756.  However, the Board could not be compelled to adopt specific regulations for its failure to abide by time limits because that was a matter of legislative discretion.  Id. at 757.  “Whether or not relief of some form would be available in a different context, upon a showing of systemic violations of RCL section 1805(d)(12), is not before us in the current case.”  Ibid. 

Princeton argues that Santa Monica Properties was decided in 2012, so the Board has been on notice for 12 years that its continued systemic violation of the RCL and Regulations is unlawful.  For at least the period of 2021 to the July 2024, the Board’s disregard has hurt only landlords.  The delay is prejudicial to all landlords in the City because rent decreases are applied untimely and result in months of no rent from the tenant post-decision.  Tenants are not negatively affected when the hearing examiner fails to subtract out the delay as required by Reg. 4203(a)(3) and issues a rent decrease for the entire period from petition to decision.  Pet. Op. Br. at 11.

Specifically, Princeton’s rent was reduced from $2,475 to $1,640.  AR 36.  Because the Hearing Examiner arbitrarily decided to apply the reduction during the eight-month hearing procedure delay contrary to Reg. 4203(a), Princeton could not collect any rent for the months of October 2023 through January 2024, could collect only a reduced rent in February 2024 of $1,420, and was only permitted to collect the “full” new monthly rent of $1,640 starting March 2024.  AR 36.  Reply at 9.

The delay in compliance determinations also prejudices only landlords.  The Hearing Examiner’s reduction of Moallef’s rent was $150 for both the right side-yard and the common courtyard that were only partially permanently removed.  AR 222, 225, 222.  In March 2024, Princeton requested a return of some of the $150 since a portion of the common area had been reinstated after the construction was concluded.  RJN Ex. 3, p. 4.  Princeton again requested a portion of the $150 on August 23, 2024.  RJN Ex. 6, p. 5. The Hearing Examiner exceeded the 30-day turnaround time of Reg. 4019(c)(2) for both compliance determinations.  Reply at 7.

In sum, the Board systemically violated the 120-day deadline of RCL section 1805(d)(12) and the 65-day hearing examiner decision deadline of Reg. 4019 by taking an average of 250 days to render 96 decisions from 2021 to 2024.  RJN Ex. 11.  That period was even longer for Princeton, whose ten cases averaged are 350 days to decision.  RJN Ex. 18.  Similarly, the Board systemically violated Reg. 4038(c)(2) for 30 separate compliance determinations from 2021 through July 2024, with an average of 87.43 days to issue a determination instead of 30 days.  RJN Ex. 12.  Pet. Op. Br. at 11.   

The Board opposes, relying on caselaw that “requirements in a statute concerning the time within which an act must be performed are ‘directory,’ rather than mandatory or jurisdictional, unless a contrary legislative intent is clearly established.”  Santa Monica Properties, supra, 203 Cal.App.4^th at 757.  The timeframes described in RCL section 1805(d)(12) and Reg.s 4019 and 4024 are directory, not jurisdictional.  Because they are directory, the only remedy for any delay in issuing a decision is a petition for ordinary mandamus to compel the public agency to perform its duty – i.e., the issuance of the decision.  Board of Education v. Sacramento City Bd. of Education, (2001) 85 Cal.App.4^th 1321, 1332.  Princeton filed no such petition, and the matter is now moot since the hearing examiner and the Board have issued their decisions.  The Board concludes there is no remaining duty to compel.  Opp. at 8-9.

The Board argues that Princeton’s reliance on Santa Monica Properties is misplaced for this reason.  Santa Monica Properties suggests that a petitioner may seek to compel the agency to issue a decision by traditional writ of mandate, but that remedy presumes the decision has not yet been issued.  Once the decision is issued, the remedy for judicial review is administrative mandamus.  Opp. at 9.  Princeton’s traditional writ claim must fail because it was not raised on administrative appeal in this case, it was not factually stated in the Petition, there is no authority or evidence to show a mandatory ministerial duty that the Board failed to perform, and there is no resulting prejudice to Princeton.  Opp. at 10.[6]

The Board is wrong.  Traditional mandamus is available to challenge an agency’s pattern or practice in violation of a ministerial duty.  Conlan v. Bonta, (2002) 102 Cal. App. 4th 745, 752 (petitioners used administrative mandamus to challenge state agency’s’ failure to reimburse them for out-of-pocket Medi-Cal expenses and could also use traditional mandamus to challenge agency’s practice of failing to reimburse Medi-Cal recipients for amounts owed for covered services obtained while Medi-Cal applications are pending). 

The Board’s distinction between directory and mandatory deadlines is irrelevant.  A statute or ordinance’s mandatory language may in fact be only directory.  The “mandatory” or “directory” designation denotes “whether the failure to comply with a particular procedural step will or will not have the effect of invalidating the governmental action to which the procedural requirement relates.”  City of Santa Monica v. Gonzalez, (2008) 43 Cal.4th 905, 923.  Courts make this designation by ascertaining the legislative intent.  Id. at 924.  Courts should “look to the procedure’s purpose or function.  If the procedure is essential to promote the statutory design, it is ‘mandatory’ and noncompliance has an invalidating effect.  If not, it is directory.”  Id. 

Thus, the mandatory/directory distinction bears on the remedy when an agency fails to meet a duty.  Princeton’s traditional mandamus claim seeks to compel the Board and its hearing examiners in the future to follow the deadlines in the RCL and the Board’s Regulations.  Princeton makes no argument that the Board’s or Hearing Examiner’s decisions for the administrative decision in its case are invalid or void for failure to follow these deadlines.  Whether the deadlines are properly characterized as directory or mandatory has no bearing on whether the Board and its subordinates are required to follow them.

There was no need for Princeton to raise this pattern and practice claim during the administrative appeal.  Where a petition challenges an agency’s failure to perform an act required by law rather than the conduct of an administrative hearing, the remedy is traditional mandamus.  Conlan v. Bonta, supra, 102 Cal.App.4^th at 752.  Indeed, the Board would not have had jurisdiction to hear it.[7]

The Board also argues that there is no resulting prejudice to Princeton.  Prejudice is not required for traditional mandamus based on a mandatory ministerial duty, but standing is.  As a general rule, a party must be “beneficially interested” to seek a writ of mandate.  Friends of Oceano Dunes, Inc. v. San Luis Obispo County Air Pollution Control Dist., (2015) 235 Cal.App.4th 957, 962 (citing CCP §1086).  “Beneficially interested” has been generally interpreted to mean that one may obtain the writ only if the person has some special interest to be served or some particular right to be preserved or protected over and above the interest held in common with the public at large.  SJJC Aviation Services, LLC v. City of San Jose, (2017) 12 Cal.App.5th 1043, 1053.  Princeton clearly has standing to raise its claims as it has ongoing rent reduction and compliance determination matters with Maollef and other tenants.

Princeton is entitled to a traditional writ of mandate compelling the Board to honor the deadlines of the RCL and its own Regulations.[8]

2. Administrative Mandamus

a. Reg. 4203(a)(3)

Princeton argues that the Board failed to proceed in the manner required by law because it violated the 65-day and 120-day deadlines for rent reduction petitions, and the 30-day deadline for compliance determinations.  No facts support the Hearing Examiner’s conclusion that “is it inappropriate to apply Regulation 4203(a)(3)” to preclude a rent reduction for a past delay.   AR 35.  The Hearing Examiner’s “inappropriate to apply” determination is an unsubstantiated determination based on speculation and conjecture.  As the finding lacks any evidentiary support, Princeton is entitled to an administrative writ ordering that the $835 rent reduction be returned to it for the eight-month delay.  Princeton argues that it was clear prejudiced by these eight months not being subtracted.  The Board has not proceeded in the manner required by law and the decision is not supported by any findings.  See CCP §1094.5(b).   Pet. Op. Br. at 12; Reply at 2.

The Board does not address this issue, [9] which requires proper interpretation of Reg. 4203.   A rent decrease “…will account for the past, present, and continuing reduction on which the decrease is based.   Reg. §4203 (RJN Ex. 5, p. 41).

“Valuing Past Reductions The total value of a reduction of services or maintenance which was in effect through the date when the hearing record is closed is calculated as follows:

(1) Determine the monthly of the reduced service or maintenance.

(2) Multiply the monthly value of the reduction by the number of months between the first rent-due date after the rent-decrease petition was filed with the Board and the date when the decrease is to go into effect.

(3) If any portion of the hearing process is delayed or continued for good cause, the calculation of the total decrease amount for past reductions shall not include that period of delay or continuance.  Reg. §4203(a) (RJN Ex. 5, p. 41) (emphasis added).”

The plain language of Reg. 4203(a) provides that the decrease of past reductions shall not include the period of a delay or continuance of the hearing process “for good cause”.  Continuances for good cause are governed by Reg. 4010A and require a written request.  No good cause application was made in this case.  The issue becomes whether the additional word “delayed” means any delay or only one based on a good cause finding.  The court concludes it is the latter.  A decrease in past reductions based on the failures of the Board or hearing examiner to adhere to their mandatory ministerial duty would harm the tenants whom the RCL is intended to protect, through no fault of their own.  Given that the Board can be compelled to follow its own deadlines through traditional mandamus, the landlord’s remedy lies in doing so and not receiving a windfall for agency error.

Parking and Storage

The Board notes that it is undisputed that the parking and storage provided to Moallef were eliminated.  The Hearing Examiner noted the parking and storage factors in Reg. 4200(g)(1) and (2) and reviewed the evidence regarding those factors, including that Moallef had indoor parking in a secured area, with limited shared access, which she used for storage, recreation, studio, and/or workshop.  AR 13-15.  The Hearing Examiner valued the rent decrease in the middle range established in Reg. 4300(f)(1) for the loss of the parking and storage amenities.  AR 28-31.  While Princeton claims that the valuation should be less because Moallef does not have a car or drive, the factors listed in the regulations demonstrate other appropriate uses for parking and storage; parking a car is only one of those uses. The Hearing Examiner made a reasonable determination based on the evidence and analysis of the Board’s regulations.  Opp. at 4.

Princeton argues that a reduction in parking is worth between $30-$550 per month but a reduction in storage is worth only$5 to $220 per month.  Reg. 4200(f) (RJN Ex. 5, p. 39).  Moallef did not drive and did not own a car.  The Hearing Examiner’s decision considered both storage and parking together.  AR 10.  The middle range between $30-$550 is $295, not $425.  The Hearing Examiner appears to have double counted, which was specifically called out during the administrative hearing.  AR 178.  Using the factors from storage, yet applying the ranges from the parking, based on a claim that were no photos of the storage (when there were) is bad faith.  Reply at 9.

Princeton argues that the Hearing Examiner’s real reason for the high rent reduction is that it reflects the high MAR (Maximum Allowable Rent) that Moallef pays.  This was improper.  The regulations require that decreases “will be proportional to the amount of impairment and proportional to the rent.” §4200(a).  The reduction is not premised whether the resident moved in recently and has a higher maximum allowable rent, although that would affect the proportionality. A 33% reduction is not proportional by any metric.  Reply at 3.

Whatever the merits of this argument, the Hearing Examiner’s decision is not supported by substantial evidence.  The parties agree that Moallef did not drive and did not park a car in the garage.  She used the garage to store her art supplies, paintings, and picture frames.  AR 200.  Basically, it was like an art studio for her, and she locked important things in the storage she did not want anyone to see.  AR 200.

Photos of garage space 21 (AR 152-156) taken in September 2020 (AR 227) show only storage usage with no car parked.  AR 152.  Nor do the photos show any type of art studio.  AR 152-56.  Although Azita was unsure whether the photos were of her mother’s garage, she admitted that her mother used her garage only for storage.  AR 226-27.  Azita testified that Moallef would not rent a storage unit because “[Moallef] doesn’t want to pay” (AR 242) and “it’s just inconvenient.” AR 245.  

Thus, Moallef used the garage only for storage.  The Hearing Examiner stated that “[t]he storage that [Moallef] alleges is lost is located inside the garage space, so both are considered together.” AR 10.  The Hearing Examiner noted that Azita credibly testified that Moallef uses the garage for storage and as an art studio.  AR 30.  She has eliminated some of those items but is storing the rest in her apartment, which makes it cluttered and limits her ability to sit and paint.  AR 30.  The factors in Reg. 4200(g)(1) and (2) weigh heavily in a higher decrease for parking and storage.  AR 30.  Due to her age and mobility, it would be difficult for her to rent off-site storage.  AR 30.  She also needs easy access to her painting supplies.  AR 30.  As a result, the loss of the garage is the equivalent of losing a room.  AR 30.  The Hearing Examiner chose a $425 reduction based on the weight of the relevant factors from Reg. 4200(g)(1)-(2).  AR 31. 

This finding is not supported by substantial evidence.  Moallef used the garage for storage only.  She did not use it for parking and did not use it as a spare room.  As a result, the Hearing Examiner had no basis to rely on the factors in Reg. 4200(g)(1) for parking.  The reduction range articulated in Reg. 4200(f)(1)-(2) is $30-550 for parking and $5-220 for storage.  AR 12 (RJN Ex. 5, p. 39).  The maximum reduction that could have been imposed is $220, not the $425 that was imposed.  AR 31.

Laundry

The Board defends the $150 reduction imposed for Moallef’s loss of laundry room.  It is undisputed that the laundry facilities were eliminated.  Princeton claims that the rent reduction for loss of laundry facilities should be less because she had the alternatives of going to a laundromat or a pick-up/drop-off laundry service at her own expense.  These alternatives are not sufficient for reasons described by the Hearing Examiner.  AR 16-17.  Opp. at 5.

More importantly, the alternatives are irrelevant.  Moallef had onsite access to laundry at the commencement of her tenancy and that amenity has been eliminated.  She is entitled to a reduction as a result.  The Hearing Examiner evaluated the evidence regarding the loss of the laundry and analyzed the value of the loss according to the relevant regulations.  AR 32-34.  Her finding that the loss of laundry warranted a reduction of $150 is supported by the evidence and within the range authorized by Reg. 4200(f)(4).  Opp. at 5. 

Princeton does not respond to this argument and the court agrees with the Board.

      The Courtyard

The courtyard to which Moallef had access at the commencement of her tenancy was eliminated.  The evidence established that Moallef made frequent use of the courtyard for additional living space.  She played with the neighborhood children, her neighbors would barbeque for her, she would garden and sit in the sun every day for at least three hours a day.  See AR 34.  She received a $150 reduction.  AR 34.  Opp. at 6.

The Board notes that Princeton did not dispute that the area was eliminated at the hearing and argued only that Moallef will regain access to the courtyard sometime in the future.  AR 288 (“the courtyard will come back...then she can sit there and do whatever it is...I just don’t know when”).  Opp. at 6.

Princeton now argues only that the Hearing Examiner’s compliance determinations regarding the restoration of the courtyard have been delayed.  Pet. Op. Br. at 4-5.  That argument is not relevant to the administrative mandamus claim concerning the Board’s January 11, 2024 decision.   

Fair Trial

Princeton argues that it did not receive a fair trial when Azita was permitted to testify through an Authorized Representative negates a fair trial, especially where the Authorized Representative does not even live at the Property and their entire testimony is essentially hearsay.  Pet. Op. Br. at 12; Reply at 9-10.

This argument is spurious for several reasons.  First, the hearing need not be conducted according to rules of evidence.  Any relevant evidence may be considered if it is the sort of evidence on which responsible persons would rely in the conduct of serious affairs.  Reg. §4012 (RJN Ex. 5, p. 8).  Azita testified based on her personal knowledge of her mother’s experience at the property. Azita provided assistance for her mother, which is expressly permitted by RCL section 1805(d)(6) and Reg. 4001A(a).  See AR 50.

Second, Princeton fails to show that it exhausted administrative remedies by raising this issue before the Hearing Examiner. 

Third, Princeton fails to show prejudice where Moallef was present for her daughter’s testimony.  A due process violation requires a showing of prejudice.  Krontz v. City of San Diego, (2006) 136 Cal.App.4^th 1126, 1141 (delay in notice and opportunity to be heard requires prejudice).  Prejudice will not be presumed; actual prejudice must be shown in order to be balanced against a due process violation.  People v. Belton, (1992) 6 Cal.App.4^th 1425, 1433 (delay in filing criminal charges requires balancing of prejudice against justification for delay).

Public Policy

At the administrative hearing in March 2023, Princeton made a public policy argument why no reductions should be issued for loss of the garage and laundry since the construction of ADUs added to the much-needed augmentation of housing units to alleviate our State’s housing crisis.   AR 175-77.  The Hearing Examiner’s decision ruled this argument was “wholly without merit.”  AR 21.  Pet. Op. Br. at 12.

Neither the City nor the Board construct housing units, private developers do.  The City uses the ADUs constructed within its limits as a basis to comply with its State-mandated requirement to add to the housing stock.  Thus, Princeton’s decision to add ten ADUs to the Premises is a service that augments the housing stock and aids the City in reaching its housing production goals.   In 2024, the City added only 34 units (RJN Ex. 15), and ten of those were the ADUs added by Princeton.  The temporary reduction of $94,996.30 in rent and the $2,786 permanent rent reduction runs afoul of the ADU laws in which the City is not permitted to obstruct construction of ADUs.  Govt. Code §65852 et seq.  These excessive rent reductions are an indirect obstruction of the City’s Housing Element.  RJN Exs. 16-17.  Pet. Op. Br. at 12-13.

The court agrees with the Hearing Examiner that this argument lacks merit.  There is a difference between policy and law.  Where a law is valid and clear, no policy argument can overcome it.  Tenants have clear rights under the RCL, and Princeton’s reliance on the fact that its ADUs may aid State-mandated housing requirements cannot overcome them.  As the Board argues (Opp. at 10-11), the ability to construct new units on the property does not absolve Princeton from complying with other local rules and regulations that apply to existing units.  Whatever Princeton may believe about the law should be, the laws governing the construction of ADUs and the City’s permitting process do not exempt the property owner from its obligations under the RCL.

G. Conclusion

The Petition is granted in part.  Princeton is entitled to a traditional writ of mandate compelling the Board to honor the deadlines of the RCL and its own Regulations.  Princeton is also entitled to a writ of administrative mandamus directing the Board to set aside the rent reduction for parking and storage and reduce it the range in Reg. 4200(g)(2) for storage.  A judgment and writ will issue to that effect.  An injunction shall also issue compelling the Board and its hearing examiners to comply with the deadlines in the RCL and Regulations.

Princeton’s counsel is ordered to prepare a proposed judgment and writ, serve them on the Board’s counsel for approval as to form, wait ten days after service for any objections, meet and confer if there are objections, and then submit the proposed judgment and writ along with a declaration stating the existence/non-existence of any unresolved objections.  An OSC re: judgment is set for April 10, 2025 at 9:30 a.m.