Judge: Michael D. Washington, Case: 30-2023-01316300-CU-WM-CXC, Date: 2024-06-14 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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SOUTH BUILDING TENTATIVE RULINGS - June 13, 2024

06/14/2024  01:30:00 PM  N-31 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Michael D Washington

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Civil - Unlimited  Writ of Mandate Demurrer / Motion to Strike 30-2023-01316300-CU-WM-CXC TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF STANTON [IMAGED] CAUSAL DOCUMENT/DATE FILED: Demurrer, 02/28/2024

Clerical Issues re Pending Motions Somewhat confusingly, there are two demurrers (one of which joins the other) and two additional joinders (both of which join the two demurrers) that appear to be pending in this case. Only the two demurrers are technically on-calendar, as it does not appear in the Court's electronic registration system that the parties that filed the two separate joinders actually obtained a hearing date to set their joinders from the Calendar Clerk. (See San Diego Superior Court, Local Rule 2.1.19A.) To put a finer point on it, while the Court will generally allow parties to 'join' motions filed by other parties without clearance from the Calendar Clerk if those joinder motions are merely joinder motions and do not contain additional argument, the two joinder motions brought by defendants C & C Development Co. LLC and National Community Renaissance of California go beyond these limitations, contain additional substantive argument, and thus required clearance from the Calendar Clerk to schedule. Nonetheless, the Court will exercise discretion and consider the two additional 'joinder' motions.

Disposition The Demurrer and Joinder to Demurrer to First Amended Complaint brought by defendant C & C Development Co. LLC (C&C) is SUSTAINED as moot without leave to amend.

The Demurrer and Joinder to Demurrer to First Amended Complaint brought by defendant National Community Renaissance of California (NCRC) is SUSTAINED as moot without leave to amend.

The Demurrer to First Amended Complaint and Joinder brought by real-party-in-interest Brandywine Acquisitions Group LLC (Brandywine) is SUSTAINED as moot without leave to amend.

The Demurrer to First Amended Complaint brought by defendants City of Stanton (the City), Hannah Shin-Heydorn (the City Manager), Stanton City Council (the City Council), Stanton Housing Authority (the Housing Authority), and Stanton Community and Economic Development Department (the Development Department) is SUSTAINED with leave to amend.

The time to amend or otherwise plead shall as set forth in California Rules of Court, 3.1320.

Request for Judicial Notice The Request for Judicial Notice (ROA 34) brought by the City, City Manager, City Council, Housing Authority, and Development Department (collectively, the City Entities) is GRANTED pursuant to Evidence Code § 451, et seq.

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3094614 CASE NUMBER: CASE TITLE:  TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF  30-2023-01316300-CU-WM-CXC The Supplemental Request for Judicial Notice (ROA 61), also brought by the City Entities, is GRANTED pursuant to Evidence Code § 451, et seq.

In granting both requests in their entirety, the Court is mindful that the existence and legal effect of the various city council meeting minutes is judicially noticeable, but that there are limits as far as taking judicial notice of the truth of facts contained or represented within those documents.

Merits of Motion – re Developer Entities The set of instant motions are unusual in that the final page of the reply brief filed by the City Entities represents: ...the circumstances since that filing [referring to the filing of the original demurrer] in February of 2024 have drastically changed. To this end, the City would invite the Court to continue the hearing so this matter can be full[y] briefed. (ROA 60, p. 11:8-10.) While the history of what has happened in this case – a case about redeveloping certain land within a municipality that previously was used to, at least in part, provide low-income housing – is vast. It spans back o about 2009 according to the briefing, and it involves a number of twist and turns with formal governmental steps being taken along the way to buy up properties in preparation to potentially sell them to a developer. But the instant case was not filed back in 2009, and there do not appear to be any references to other litigation that may have been initiated along the long and winding path that has been taken in the effort to redevelop the property in question. The focus, or perhaps the 'triggering event' that appears to have sparked the instant lawsuit is the entry into a formal agreement between the City and certain developer entities. That agreement is labeled an 'Exclusive Negotiating Agreement' or ENA.

What makes the ENA somewhat unique in context is that it does not appear to be an agreement for formally do anything other than negotiate – albeit exclusively. In other words, the ENA is not a formal contract to start any construction or even to start other construction-related things like demolition. It is just an agreement that the City will cease negotiations with other potential developers so that it can work-out a deal with those developers who are parties to the ENA.

There is much discussion in the briefing about whether or not the ENA amounts to a 'project.' But there is also argument suggesting that whether or not an ENA is a 'project' is not the key inquiry to be making.

In other words, Petitioners' position is that tenants who live in low-income housing are entitled to certain statutory rights like help with relocating and/or priority in any new low-income units that are built and that those rights do not necessarily need to wait until a formal 'project' is approved by a municipality. To that end, Petitioners appear to be seeking an order from this Court directing the City Entities to provide those various things that the statute requires for low-income tenants.

This raises a bit of an interesting question in terms of when the statutory rights that Petitioners are invoking get triggered. The City's position is that they do not get triggered until a formal 'project' is approved, but Petitioners take the position that entering into the ENA was enough to trigger the statutory obligations. It is for this reason that the final page of the reply brief filed by the City Entities is both pertinent and unusual – it shifts the plate tectonics underneath the lawsuit by rendering the ENA issue moot using information that is judicially-noticeable.

Of course, it appears that the dissolving of the ENA occurred fairly recently such that it could only be introduced in the reply brief, and, as a general rule, moving parties are not permitted to raise new matter in a reply brief because it effectively denies the opposing party an opportunity to respond – though an exception exists when the new material did not exist or was only just discovered. As such, the new facts about the ENA being dissolved are permissible in a reply brief, but that leaves the briefing of the instant matter somewhat impotent as it does not address the current status of the case.

The Court further notes that the current status of the case is important here because of the remedy being sought by Petitioners. Petitioners do not appear to be seeking money damages via the instant Calendar No.: Event ID:  TENTATIVE RULINGS

3094614 CASE NUMBER: CASE TITLE:  TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF  30-2023-01316300-CU-WM-CXC lawsuit. They seek orders, injunctions, writs of mandate, and declarations – though they also appear to seek a few ancillary financial awards to cover their costs of suit and/or attorney fees.

Ultimately, even if the ENA was still in effect, the arguments by the developer entities – C&C, NCRC, and Brandywine (collectively, the Developer Entities) – are persuasive. First, the allegations that are made do not tie the Developer Entities to the whole history if displacement since 2009; rather, the nexus between the Developer Entities' role and the statutory obligations that exists with regard to relocating occupants of low-income housing is the ENA. Even if the ENA was still in effect, briefing invokes the 'primary jurisdiction doctrine,' which: ...'comes into play whenever enforcement of the [plaintiff's] claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its view.' Blue Cross of California, Inc. v. Superior Court (2009) 180 Cal.App.4th 1237, 1260, quoting Farmers Ins. Exchange v. Superior Court (1992) 2 Cal.4th 377, 390.

Whether or not this precise doctrine applies, the point is well-taken that it is up to the municipality that is subject to the low-income housing relocation statutes to enforce those mechanisms. This Court can review the actions of the municipality via the writ of mandate procedure, but it is not for this Court to step into the proverbial shoes of the municipality.

It is understandable that, to the extent the municipality is alleged to have not been properly following the law or meeting its statutory obligations, there is some limited role in a case such as this one for naming the private party developers so that they can be enjoined from proceeding while any wrongdoing by the municipality is being litigated. As such, the Court does not necessarily fault Petitioners for the simple act of naming the Developer Entities; however, without a formal project or project approval in place there is nothing to enjoin. At best, it would appear that Petitioners can request an injunction to stop the Developer Entities from engaging in further negotiations with the City Entities. However, the act of negotiating is not what allegedly violates the low-income housing statutes – it is the acts of evicting, displacing, or relocating (as well as perhaps the failure to provide certain services or monies to low-income tenants when those processes are occurring) that allegedly violates the statutory provisions at issue. As such, even if the ENA were still in place and the Developer Entities were still actively negotiating with the City Entities, the claims against the Developer Entities would not be ripe because there is nothing to enjoin – other than negotiations, which do not violate the statutory provisions at issue.

For the foregoing reasons, the Court concludes that all of the demurrers (joined or otherwise) brought by the respective Developer Entities are meritorious. Additionally, as the ENA is not even in existence anymore, the Court concludes that leave to amend is unnecessary.

Merits of Motion – re City Entities The claims with regard to the City Entities stand in somewhat different stead because, unlike the Developer Entities who would only be prohibitively enjoined from engaging in acts that violate the low-income housing statutes, the City Entities may have affirmative duties under the law. Indeed, the Prayer for Relief in Petitioners' Complaint requests, inter alia, that this Court '[c]ompel[] the Successor Agency and the Housing Authority to immediately adopt an adequate Replacement Housing Plan...' and '[c]ompel[] the Successor Agency and the Housing Authority to include the Replacement Housing Plan in the ENA.' (First Amended Complaint, p. 21:13-19.) As such, the question remains whether the obligation to meet those duties has arisen within the context of the events that have occurred.

However, even as to this set of claims, the plate tectonics underneath the lawsuit have shifted a bit due to the recent dissolving of the ENA. There is some confusion between the briefing and the allegations on this point. Specifically, Petitioners make allegations that seek judicial determinations directed toward the ENA: 86. Petitioners request declaratory relief determining that Respondents have not complied with the Calendar No.: Event ID:  TENTATIVE RULINGS

3094614 CASE NUMBER: CASE TITLE:  TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF  30-2023-01316300-CU-WM-CXC CRAA, and enjoining Respondents from implementing the ENA until such time as Responding Agency complies with the CRAA.

92. Petitioner request declaratory relief determining the Successor Agency and Housing Authority have not complied with the CRL and an order enjoining the Successor Agency and Housing Authority from implementing the ENA until such time as the Successor Agency and Housing Authority comply with the CRL.

Prayer for Relief... 1c. Compels the Successor Agency and the Housing Authority to include the Replacement Housing Plan in the ENA.' Prayer for Relief... [seeking a declaration that] 2b. By entering into the ENA, Respondents have illegally used the Housing Asset Fund to develop market-rate housing, an impermissible administrative use of the Housing Asset Fund...

(First Amended Complaint, ¶¶ 86, 92, and Prayer for Relief 1c and 2b (bold added).) However, despite this clear focus in the operative pleading, Petitioners argue in their opposition brief that: The ENA is simply circumstantial evidence that Defendants are engaged in activities related to the acquisition and development of property and may have plans related to that development that do not comply with the relevant statutes... Even if there was no ENA, Defendants would have still engaged in sufficient activities to trigger their statutory obligations. That is because, again, and as set forth in the operative pleadings, over the course of the last decade, Defendants have acquired 80 percent of the residences in the Tina-Pacific Neighborhood and engaged in a variety of activities that have displaced affected tenants. (ROA 57, p. 10:15-23 (bold added).) The heart of the present dispute about justiciability of the instant case (whether due to ripeness, mootness, or standing) seems to turn in no small part on which of those actions that are included under the umbrella-phrase 'variety of activities' triggered the statutory obligations that Petitioners are now asking this Court to enforce or impose upon the City Entities. This problem creates significant confusion in both the briefing and the allegations in terms of locating a nexus between the particular activity that triggers one of the statutory obligations and then identifying which statutory obligation it triggers.

From reading the allegations and the Prayer for Relief, it appears that Petitioners are hinging much of their relief sought on the ENA, but their actual briefing backs away from this notion and focuses on the more nebulous 'variety of activities.' Importantly, the City Entities have raised 'uncertainty' as a ground for demurrer, and, though operative pleading appears to have been drafted skillfully, it appears that some of the uncertainty may be by design. It appears to the Court that the dissolving of the ENA has the potential to resolve much of the confusion that results from the allegations as drafted. By removing the ENA from consideration, Petitioners will have to identify which specific actions in the 'variety of activities' trigger specific statutory obligations – and, correspondingly, will have to request relief that has a nexus with the statutory obligation and the underlying unlawful activity.

With the above in mind, rather than taking the City Entities up on their invitation to request further briefing, the Court concludes that sustaining the demurrer with leave to amend on grounds of uncertainty is the better course of action, as it will provide Petitioners with an opportunity to 'update' their allegations to account for the current status of things given that the ENA is no longer in effect and any request to use injunctive relief to modify it would be moot.

To be clear, the Court is not entirely convinced by the City Entities' argument that their statutory obligations do not get triggered unless and until a formal 'project' is adopted by city officials. It is not lost on the Court that the picture Petitioners are painting is one in which local governmental officials may wish to circumvent the legal obligations that exist for the protection of low-income individuals under the California Relocation Assistance Act. It is also not lost on the Court that to effectuate such a purpose, there may be a deliberate strategy of waiting to formally approve a project only once all of the Calendar No.: Event ID:  TENTATIVE RULINGS

3094614 CASE NUMBER: CASE TITLE:  TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF  30-2023-01316300-CU-WM-CXC displacements have been handled by the municipality. Indeed, there is reference in the allegations and briefing to the City Entities stopping accepting rent payments and deliberately allowing rental units to become uninhabitable in order to constructively evict certain tenants.

What is not as clear to the Court is where other remedies end and the remedy of a writ of mandate begins. In other words, if a municipality buys up land that has low-income housing, then lets that land go into disrepair and stops accepting rent checks – such actions would appear to be the subject of a civil lawsuit between a tenant and their landlord regarding habitability or regarding breach of the rental contract by not accepting rent payments. With that in mind, while Petitioners paint a picture that would appear to need a remedy – in that duplicitous actions to try to oust tenants before a formal project is approved appear to violate the spirit of the California Relocation Assistance Act – in seeking to locate where along the timeline of the notably lengthy development permitting and approval process the statutory obligations are triggered and begin to apply (and thus become enforceable via writ of mandamus and/or injunction) Petitioners appear to be on weaker footing. Indeed, the City Entities cite a provision of the statute that indicates that the statutory obligations are designed to be efficient and cost-effective – not necessarily onerous to the point of 'chilling' development from occurring.

It is also for this reason that the Court notes a significant difference between certain of the Petitioners - a difference that, when not parsed-out in the pleadings, bolsters the confusion and uncertainty of the case.

One set of Petitioners are entities – i.e. Tina-Pacific Residents Association and The Kennedy Commission. The other set of Petitioners are individual tenants – i.e. Melinda Bahena, Jennifer Bahena, and Maria de los Angeles Pineda. To the extent that the instant demurrers raise justiciability issues, these two different categories of petitioners appear to stand in very different stead. To the extent that the individual Petitioners actually live in a unit and are feeling the effects of the effort to relocate them presently, it would appear they might have standing to benefit from some sort of injunctive relief about their present case or controversy. However, with regard to the entity Petitioners, it appears that the raising of many years of alleged violations of the California Relocation Assistance Act may ring a bit hollow – and advisory. In other words, to the extent that prior tenants may have relocated in some fashion or other (whether voluntarily over the years, by a buyout by the municipal authorities, by constructive eviction, or by other means), it is not clear what standing the entity Petitioners have to assert claims on behalf of the former tenants, and is it not clear what injunctive relief now would do for those former tenants who have already left.

While the Court will grant leave to amend to all Petitioners, the Court emphasizes at this juncture that some of the confusion that relates to the uncertainty upon which the instant Demurrer to First Amended Complaint stems from the failure to clearly parse between those Petitioners who currently live in the units at issue and might benefit from certain injunctive relief as opposed to those entities who might be speaking for an entire 'class' of tenants – some of whom have already been relocated and would not benefit from injunctive relief.

Finally, at the risk of citing statutory that can sometimes suggest bad faith or heavy-handedness (which the Court is not suggesting took place in the filing of the current pleading), the Court notes that certain obligations to be truthful come with the filing of legal pleadings. (See Code of Civil Procedure § 128.7.) There is, presently, an allegation in the operative pleading that: 'Respondents have approved the Tina-Pacific project...' (First Amended Complaint, ¶ 98.) However, judicially-noticeable information indicates that no such project was approved; rather, the ENA – an agreement to exclusively negotiate – was put in place to potentially work toward the final approval of a project. On demurrer, the Court must take the allegations as true and must construe the facts liberally and indulge them in favor of the complaining party. However, with that in mind, Petitioners must take some care in making their amended allegations, as allegations that can be proven untrue via judicially-noticeable facts may fall within the ambit of the 'sham pleading' doctrine. (Weil and Brown, California Practice Guide: Civil Procedure Before Trial (The Rutter Group) § 6:648, citing Vallejo Develop. Co. v. Beck Develop. Co. (1994) 24 Cal.App.4th 929, 946, also citing State of Calif. ex rel. Metz v. CCC Information Services Inc. (2007) 149 Cal.App.4th 402, 412 ('The judge also has discretion to deny leave where the proposed amendment omits or contradicts harmful facts pleaded in the original pleading, absent a showing of mistake or other Calendar No.: Event ID:  TENTATIVE RULINGS

3094614 CASE NUMBER: CASE TITLE:  TINA-PACIFIC RESIDENTS ASSOCIATION ET AL. VS. CITY OF  30-2023-01316300-CU-WM-CXC sufficient excuse for changing the facts. Without such a showing, the amended pleading may be treated as a sham.') (emphasis in original).) In other words, with it being known to all parties that the ENA has been dissolved recently (a fact that was not true at the time the original pleadings were drafted and filed), the Court would not anticipate seeing an allegation that the City Entities 'have approved' a Tina-Pacific project unless either: (1) facts change in the present, or (2) Petitioners expect to make a good faith and colorable argument that even without a formal vote to 'approve' a plan the City Entities' actions amount to project 'approval' under the law even without a formal vote to approve. With this in mind, and with the changed landscape, an amended pleading may be able to resolve the uncertainty that exists within the four corners of the current First Amended Complaint.

Unless the ruling(s) above indicate that an appearance is necessary, parties who wish to submit, who are satisfied with the above tentative ruling(s), and/or who do not otherwise wish to argue the motion(s) are encouraged to give notice to the Court and each other of their intention not to appear.

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