Judge Mitchell L. Beckloff, Case 22STCV18726 2022-08-05 Tentative Ruling

Judge: Mitchell L. Beckloff, Case: 22STCV18726, Date: 2022-08-05 Tentative Ruling

This action arises out of alleged nuisance conditions on real property located at 1754 Hanscom Avenue in the City of South Pasadena (Property).

On June 7, 2022, Petitioner, City of South Pasadena, filed its petition for appointment of a receiver against Respondents, Janet Ferguson and John S. Algeo, pursuant to Health and Safety Code section 17980.7 et seq.

On June 30, 2022, Petitioner filed an ex parte application for an order appointing Mark Adams as receiver to abate a public nuisance pursuant to Health and Safety Code section 17980.7, subdivision (c). Petitioner and Respondent Ferguson appeared at the ex parte hearing. The parties engaged in some discussion about resolution of the issues raised by the City. Defendant Ferguson indicates she wished to sell the Property. The court set the matter for a hearing.

Respondent Ferguson filed an opposition to the petition on July 15, 2022. In her opposition, Respondent Ferguson indicates more than 80 percent of the City’s concerns about the Property have been addressed. She reported, “The rest of the conditions are being addressed imminently as the property is being listed with The Bryant Company for sale as discussed and agreed upon” by the City at the ex parte hearing. Respondent Ferguson asked that the City remove the “red tag” on the Property and that electrical power be restored to maximize the price obtained for the sale. Respondent Ferguson also requested she be permitted to “vacuum and clean the interior.”

Respondent Ferguson also explains why the Property is in disrepair. She also contends Petitioner uses “unethical tactics.” Respondent Ferguson describes the surprise of 20 to 25 officials appearing at the Property when she believed a single code enforcement officer would be appearing.[1]

A receiver may be appointed by the court in any case in which the court is empowered by law to appoint a receiver. (Code Civ. Proc., § 564, subd. (a).) Petitioner moves here for appointment of a receiver pursuant to Health & Safety Code section 17980, et seq.

“If the owner fails to comply within a reasonable time with the terms of the order or notice issued pursuant to Section 17980.6,[2] the following provisions shall apply:

(c) The enforcement agency, tenant, or tenant association or organization may seek and the court may order, the appointment of a receiver for the substandard building pursuant to this subdivision. In its petition to the court, the enforcement agency, tenant, or tenant association or organization shall include proof that notice of the petition was posted in a prominent place on the substandard building and mailed first-class mail to all persons with a recorded interest in the real property upon which the substandard building exists not less than three days prior to filing the petition. The petition shall be served on the owner pursuant to Article 3 (commencing with Section 415.10) of Chapter 4 of Title 5 of Part 2 of the Code of Civil Procedure.

(1) In appointing a receiver, the court shall consider whether the owner has been afforded a reasonable opportunity to correct the conditions cited in the notice of violation.

(2) The court shall not appoint any person as a receiver unless the person has demonstrated to the court their capacity and expertise to develop and supervise a viable financial and construction plan for the satisfactory rehabilitation of the building. . . .”

Separate from the Health & Safety Code, substandard housing conditions may constitute a public or private nuisance. Civil Code section 3479 defines “nuisance” as including anything injurious to health. (Civ. Code, § 3479. [“Anything which is injurious to health, including, but not limited to, the illegal sale of controlled substances, or is indecent or offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property . . . is a nuisance.”]) A public nuisance is one which affects at the same time an entire community or neighborhood, or any considerable number of persons, although the extent of the annoyance of damage inflicted upon individuals may be unequal.” (Id., § 3480.)

The court need not consider whether less invasive alternatives are available when determining whether a receiver should be appointed pursuant to Health and Safety Code section 17980.7. (City of Crescent City v. Reddy (2017) 9 Cal.App.5th 458, 467.)

Preliminarily, the court notes it has received no evidence in opposition to the City’s request to appoint a receiver. Nonetheless, Petitioner clearly opposes the appointment of a receiver.

Petitioner provides evidence of nuisance conditions at the Property. The Property has been the subject of multiple code enforcement inspections and code violations for many years before the City ultimately red-tagged the Property as unsafe for occupancy on May 3, 2022. (Mandala Decl.[3] ¶ 32; Riddle Decl. ¶¶ 4-6, Ex C; see also Ex Parte Application 5:10-6:23 [summarizing Property’s issues over the years], 6:24-8:3 [the inspections in 2022 that led to the red-tagging of the Property].) Petitioner determined the Property was unsafe because it constituted a “substantial fire hazard” and a “danger to occupants, neighbors, and the general public.” (Mandala Decl. ¶ 7; Riddle Decl. ¶¶ 10-11, Ex. Z.) There were many violations and dangerous conditions, including inadequate exterior weatherproofing, accumulation of debris and junk, inadequate ventilation, electrical hazards, unsafe means of ingress and egress, abandoned construction, undermined foundation, and lack of proper heating. (Mandala Decl. ¶ 31, Ex. X, Y, AA, BB.) This hazard is compounded by the Property’s location in a “high risk fire area” because of the proximity to the soft chapparal scrub terrain. (Riddle Decl. ¶ 5.)

Petitioner has introduced evidence sufficient to establish the Property is in substandard condition, constitutes a nuisance, and is a fire hazard. Respondent Ferguson’s opposition does not persuasively show with admissible evidence that the conditions have been remedied to such an extent the Property no longer poses a nuisance. Respondent Ferguson argues that less than 20 percent of Petitioner’s concerns about the physical condition of the Property remain. (Opposition 1:6-7.) Respondent Ferguson does not specify what concerns or how the remaining concerns are not severe. Respondent Ferguson has presented only argument on the issue. That the cause of the nuisance (a lack of funds) is unfortunate, the cause of the nuisance does not minimize the Property as a nuisance. (Id. 1:19.) Even though Respondent Ferguson may have financial difficulties, the owners of the Property have a responsibility to maintain the Property. That Petitioner has pursued its legal rights in a manner that has caused Respondent Ferguson anxiety is also unfortunate. (Id. 2:1-15.) Petitioner does not persuasively explain how Petitioner’s tactics go beyond zealous advocacy to bad faith such that the court should take no action where the nuisance is clear. Finally, while Respondent Algeo may have caused the conditions at the Property resulting in the nuisance, the cause does not excuse the nuisance. (Id. 2:16-19.) The owners of the Property are both responsible for maintaining it.

To obtain the appointment of a receiver, among other things, Petitioner must prove that it complied with the statutory notice requirements of Health & Safety Code section 17980.7, subdivision (c). Thus, Petitioner must provide proof [1] “the petition was posted in a prominent place” on the Property, [2] mailed by first-class mail to “all persons with a recorded interest in the real property upon which the substandard building exists” and [3] served on the owner “pursuant to Article 3 (commencing with Section 415.10) of Chapter 4 of Title 5 of Part 2 of the Code of Civil Procedure.” (Health & Saf. Code § 17980.7, subd. (c).)

Petitioner has not filed a single proof of service in this matter. While Respondent Ferguson has actual notice of these proceedings, there is nothing to suggest Respondent Algeo has been served with the petition.

Petitioner has provided proof of service of a “letter re: 1754 Hanscom Drive, South Pasadena, CA 91030 addressed to Robert K. Holmes Dated on May 20, 2022.” (Mendez Decl. Ex. GG.) The proof of service is completely inadequate—the court cannot determine what “NOTICE” the process server purportedly posted on the Property. Certainly, the proof of service does not suggest Petitioner posted the petition (as required by statute) three days prior to filing the petition. Moreover, there is no evidence why Robert K. Holmes would receive notice at the Property. According to Exhibit A of the petition, Robert K. Holmes does not own the Property. Petitioner has not provided any evidence of due diligence to provide him with the required notice. In addition, the Federal Express receipts at Exhibit GG are unexplained—the statute requires service by first-class mail. (Mendez Decl. Ex. GG.) Given that the City alleges Respondent Algeo resides in New Hampshire, delivery service to Respondent Algeo at the Property is not reasonably calculated to provide him with notice. (Petition ¶ 3.)

Finally, the court notes Adams is sufficiently qualified to act as a receiver in this matter.

(See Adams Decl. ¶ 2. [“As President of CRG, I have been appointed as a receiver by 158 different Superior Court Judges and one United States District Court Judge. As a Receiver, I have overseen the abatement of 283 nuisance properties throughout the state.”])

Based on the foregoing, Petitioner’s application for an appointment of a receiver is denied without prejudice.

[1] The City did not file a reply. (Respondent Ferguson did not file a proof of service, and it is unclear whether Respondent Ferguson served the opposition papers on the City.)

[2] A city may issue an order to repair or abate a nuisance where violations of relevant building codes and regulations “are so extensive and of such a nature that the health and safety of residents or the public is substantially endangered.” (Health & Saf. Code § 17980.6.)

[3] All citations to declarations are to the declarations filed on June 7, 2022 in support of the petition. The declarations are identified in a notice of lodging filed in connection with the City’s ex parte application.