Judge Stephen I. Goorvitch, Case Number: 24STCP02065, Date: 2025-01-27 Tentative Ruling

Judge: Stephen I. Goorvitch, Case: 24STCP02065, Date: 2025-01-27 Tentative Ruling

The Real Party In Interest, Stanford Del Mar, LLC (the “Real Party”), sought approval to split a vacant lot in the City of Santa Monica (the “City”). The Real Party submitted the application under SB 9—Government Code sections 66410 et seq.—though the City has its own version, which is Santa Monica Municipal Code section 9.31.125. An assistant city planner rendered a “preliminary approval.” Petitioner Stanford Neighbors Against City Overreach (“Petitioner”) filed this petition seeking a writ of mandate invalidating this approval. Petitioner also filed claims for declaratory and injunctive relief. Respondents demur to the petition, arguing that it is untimely under 66499.37; Petitioner did not exhaust administrative remedies; and in the alternative, the petition is not ripe. Respondents also argue that Petitioner does not allege violations of SB 9 and section 9.31.125 because those statutes effectively prohibit splitting of vacant lots and Petitioner (as a limited liability company) cannot comply with the owner-occupancy requirements. Finally, Respondents argue that Petitioner does not establish a violation of the Oaks Initiative (which requires a certain financial interest disclosure) and that the declaratory relief claim is duplicative. The court overrules the demurrers.

Petitioner challenges the City’s “tentative approval” of a lot split application under Senate Bill (“SB”) 9. (FAP ¶ 1.) The property is a vacant lot located at 1101 Stanford Street in Santa Monica, California 90403 (the “Property”). (Ibid.) SB 9 requires a proposed housing development containing no more than two residential units within a single-family residential zone to be considered ministerially, without discretionary review or hearing, if the proposed housing development meets certain requirements. (City’s Request for Judicial Notice (“RJN”) Exh. B.) SB 9 also requires local agencies to ministerially approve the subdivision of a parcel in a single-family zone. (Id., Exh. C.)[1] In the City’s Municipal Code section 9.31.125, the City adopted the ministerial lot split provisions of SB 9 and also expanded them for R-1 zoned parcels of 10,000 square feet or greater to authorize accessory dwelling units (“ADUs”) in addition to SB 9 projects. (City’s RJN, Exh. M at 236, 357-358, Exh. T at 715.)

The Real Party acquired the Property on or about August 11, 2023. (FAP ¶ 26.) At that time, the Property “was a 13,462 square foot vacant lot with no structures, habitable or otherwise, and remains so as of the filing of this First Amended Petition.” (Id. ¶ 27.) On October 1, 2023, the Real Party filed its application for an SB 9 lot split with the City’s Planning Division. (Id. ¶ 30.) The application describes the project as follows: “Per SB 9, this project splits one existing R-14 lot into two lots. Each resulting lot will be developed with a duplex. Each resulting lot will also include a shared community room space, and two detached Accessory Dwelling Units.” (Id. ¶ 31.) The application lists the “Applicant” as Stephen K. Anderson and the “Property Owner” as the Real Party. (Pet. RJN, Exh. 2.) As relevant to the demurrer, Anderson also signed an “SB 9 Owner-Occupant Affidavit,” under penalty of perjury, stating that “[the] Property owner shall intend to live on one of the resulting parcels for three years after subdivision completion” and “[the] Property owner shall intend to live in one of the proposed units for three years.” (City RJN, Exh. A at 7.)

Attached to the SB 9 application is an Oaks Initiative Disclosure Form, which is “required for all applications.” (Id., Exh. A at 6.) Anderson identified himself as the “Applicant/Contractor” on this form and then stated “NA” in response to questions asking him to identify the “Trustees, directors, partners, officers of the Applicant” or persons “with more than 10% equity, participation or revenue interest in Applicant / Contractor.” (Ibid.)

On February 13, 2024, “an assistant city planner in the City’s Planning Division tentatively approved Stanford Del Mar’s lot split application on a ministerial basis.” (FAP ¶ 39.) The tentative parcel map includes an SB 9 Approval stamp, which refers to Ross Fehrman as the planner and is dated February 13, 2024. (Pet. RJN, Exh. 2.) Petitioner filed this action on June 27, 2024.

A demurrer tests the sufficiency of a pleading, and the grounds for a demurrer must appear on the face of the pleading or from judicially noticeable matters. (Code Civil Proc. § 430.30, subd. (a); Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) “We assume the truth of the allegations in the complaint, but do not assume the truth of contentions, deductions, or conclusions of law.” (California Logistics, Inc. v. State (2008) 161 Cal.App.4th 242, 247.) The allegations in the petition must be liberally construed in favor of Petitioner on demurrer. (See Mobil Oil Corp. v Exxon Corp. (1986) 177 Cal.App.3d 942, 947.) “A demurrer must dispose of an entire cause of action to be sustained.” (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.) “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.” (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)

The City requests judicial notice of Exhibits A through Z. No party objects. The court grants the request under Evidence Code section 452(b) and/or (c).) The City also requests judicial notice of Exhibits AA through CC with the reply brief. Petitioner filed no objection to this request, and Exhibits AA and BB are clearly subject to judicial notice under Evidence Code section 452(b). Therefore, the court grants the request with respect to these exhibits. The court denies the request with respect to Exhibit CC. The contents of the City’s webpage are not suitable for judicial notice under section 452.

The Real Party request judicial notice of Exhibits A through Q. No party objects to the request with respect to Exhibits A-E and G-J and L-Q. The court grants the request with respect to these exhibits under Evidence Code sections 452(b) and/or (c).

Petitioner objects to the Real Party’s request for judicial notice of Exhibit F and Exhibit K. Exhibit F is not relevant to the issue before the court. Exhibit K is duplicative of Exhibit A to the City’s request for judicial notice. Therefore, the court declines to rule on the request to take judicial notice of these exhibits. (See Code Civ. Proc. § 437c(q).)

Petitioner requests judicial notice of Exhibits 1 and 2. No party objects to the request. The court takes judicial notice under Evidence Code section 452(b) and/or (c).

This action is governed by the statute of limitations in Government Code section 66499.37, which states as follows:

Any action or proceeding to attack, review, set aside, void, or annul the decision of an advisory agency, appeal board, or legislative body concerning a subdivision, or of any of the proceedings, acts, or determinations taken, done, or made prior to the decision, or to determine the reasonableness, legality, or validity of any condition attached thereto, including, but not limited to, the approval of a tentative map or final map, shall not be maintained by any person unless the action or proceeding is commenced and service of summons effected within 90 days after the date of the decision. Thereafter all persons are barred from any action or proceeding or any defense of invalidity or unreasonableness of the decision or of the proceedings, acts, or determinations.

(Gov. Code § 66499.37, emphasis added.) An “advisory agency” is defined as:

[A] designated official or an official body charged with the duty of making investigations and reports on the design and improvement of proposed divisions of real property, the imposing of requirements or conditions thereon, or having the authority by local ordinance to approve, conditionally approve or disapprove maps.

(Gov. Code § 66415, emphasis added.) The “Legislature by design drafted section 66499.37 broadly” and “[c]onsequently, regardless of the nature or label attached to the action challenging the legislative body’s subdivision-related decision the action is governed by section 66499.37.” (Presenting Jamul v. Board of Supervisors (1991) 231 Cal.App.3d 665, 671.) “[S]ection 66499.37 is not by its terms limited in application to quasi-judicial or discretionary decisions.” (Kirk v. County of San Luis Obispo (1984) 156 Cal.App.3d 453, 460.) “Therefore the limitations period in section 66499.37 applies when the conduct of a local agency under the Subdivision Map Act is called into question,” including in a traditional mandamus action that seeks to enforce a ministerial duty of the local agency. (Id. at 459-460.)

In order to prevail, Respondents must demonstrate that this action is necessarily untimely based upon the petition’s allegations and judicially-noticeable documents. (See Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 881.) Respondents do not satisfy this standard. The petition alleges that an “assistant city planner” named Ross Fehrman “tentatively approved” the lot split application “on a ministerial basis on or around February 13, 2024. (FAP ¶ 39.) The SB 9 approval states:

The proposed project is preliminary [sic] approved pursuant to the requirements and standards set forth in SMMC Chapter 9.31.125. Additional review will be conducted by all City Departments for compliance with all other applicable standards and requirements during the building permit review process.

(Pet. RJN Exh. 2.) The use of the word “preliminary” in the approval, as well as the statement that “additional review will be conducted,” raise factual questions whether this was a final approval by someone having the authority to do so.

The City and the Real Party argue that Santa Monica Municipal Code (“SMMC”) section 9.31.125 “vests the authority to ministerially process tentative maps in the Planning and Community Development Director (or its designee) through a process determined by the Director.” Section 9.31.125(C) provides the following “Review Process” for SB 9 applications:

1. Projects established under this Section shall be subject to a ministerial approval and design review process as determined by the Director prior to submittal of a building permit.

2. Lot splits shall be subject to the provisions of Chapter 9.54, Land Divisions, except that no Planning Commission hearing is required for the tentative map process.

(SMMC § 9.31.125(C)(1) and (2), emphasis added; City’s RJN Exh. T at 713.) The court cannot determine based upon the petition or the judicially-noticeable records what the “ministerial approval and design review process” was, and by extension, whether a “preliminary approval” by an assistant city planner constitutes a final approval for purposes of triggering the statute of limitations.

The City argues that the Director is authorized to approve SB 9 applications, and that he necessarily delegated his approval authority to the assistant city planner, citing the approval itself. (See City RJN Exh. A, at 15.) There is nothing on that page that clearly supports the City’s argument. The City argues that SMMC 9.03.020 necessarily includes assistant city planners because it states: “All references to public officials are to those of the City, and include designated deputies of such officials, unless otherwise indicated.” (City RJN Exh. BB.) The petition identifies Ross Fehrman as an “assistant city planner,” and it is unclear from the record whether he is one of the “designated deputies” referenced in the SMCC. Even if so, there are two additional problems with Respondents’ arguments. As discussed, the court still has no knowledge of the “ministerial approval and design review process,” so the court cannot determine whether Fehrman’s approval is sufficient, especially considering the language that this was a “preliminary” approval and subject to other approvals before becoming final.

More important, it is unclear whether the City complied with additional potential prerequisites to approval. Section 9.31.125(C) states: “Lot splits shall be subject to the provisions of Chapter 9.54, Land Divisions, except that no Planning Commission hearing is required for the tentative map process.” Chapter 9.54 states: “If a tentative map is approved or conditionally approved, including approval by failure of the Planning Commission to act within the time required by law, the Director shall make a written report to the City Council within 5 days of such approval.” (SMMC § 9.54.070(e), emphasis added.) Presumably, this exists to permit the City Council to review and, if appropriate, veto the decision. At the pleading stage, the court must presume this is a prerequisite to final approval, and there is nothing in the record suggesting that the City complied with this requirement. The court need not address Petitioner’s argument that a report to the Planning Commission was required even in the absence of a hearing.

Respondents cite Coalition for an Equitable Westlake/Macarthur Park v. City of Los Angeles (2020) 47 Cal.App.5th 368, 374, fn. 4 and argue that the “legality” of designating final SB 9 approval to a city planner “has been confirmed by the courts.” (See City’s Dem. 14.) In Coalition, the Court of Appeal summarized the following procedural history:

[A]fter holding a hearing, the Deputy Advisory Agency (Agency) for the City of LA approved the Project's vesting tentative tract map (Tract Map) and certified a mitigated negative declaration (MND) for the Project. A 30-page determination letter memorializing the Agency’s actions noted that any appeal must be filed with the City Planning Commission (Planning Commission) within 10 calendar days from the decision date, and that there may be time limits which affect the availability of judicial review.

(Coalition, supra, 47 Cal.App.5th at 374, emphasis added.) In a footnote, the Court then stated: “The Director of Planning is the advisory agency for the City of LA, and he or she is ‘authorized to act in such capacity through one or more deputies who are appointed by him for that purpose.’” (Id. at fn. 4, citing L.A. Mun. Code, § 17.03.) The formal process at issue in Coalition, which included a hearing, a 30-page determination letter, and notice of appeal rights, is not similar to the informal process before the assistant city planner alleged in the petition. Neither Petitioner nor the court disputes that the Director Planning can establish a process to reach a final decision. Rather, the unresolved issues here are: (1) What process applied to this approval; (2) Based upon that process, whether the “preliminary approval” was a final approval that triggered the statute of limitations; and (3) Whether the Director delegated his authority to an assistant city planner. The court cannot resolve those issues based upon the petition and the judicially-noticeable documents.

In reply, the Real Party argues that “[r]ecent additions to the SMMC that went into effect after filing of the Demurrer further clarify that Planning Commission approval is not required for an SB 9 lot split.” (Real Party’s Reply 4, citing Suppl. RJN Exh. L and SMMC § 9.54.140(C)(1)(a).) Section 9.54.140(C)(1)(a) states that subdivisions pursuant to section 9.31.125 “are exempt from Planning Commission approval.” (Real Party’s Suppl. RJN Exh. L.) “The salutary rule is that points raised in a reply brief for the first time will not be considered unless good cause is shown for the failure to present them before.” (Balboa Ins. Co. v. Aguirre (1983) 149 Cal.App.3d 1002, 1010.) The Real Party has not shown good cause to raise this argument for the first time in reply. It appears that section 9.54.140(C)(1)(a) was added to the SMMC by ordinance on October 8, 2024, and the Real Party’s demurrer was filed on October 24, 2024. Regardless, this new ordinance does not address the dispositive issues.

Finally, the City argues that all challenges to section 9.31.125 and the City’s Housing Element are time barred. (City’s Dem. 14-16.) Petitioner does not challenge section 9.31.125 or the City’s Housing Element in the first cause of action. Accordingly, the court does not reach these arguments.

Based upon the foregoing, the court overrules the demurrer based upon the statute of limitations. The court cannot determine based upon the allegations or the judicially-noticeable documents whether this action necessarily is untimely. Respondents may raise this issue at the merits stage when the court may consider the evidence, assuming there was a “ministerial approval and design review process” that supports their arguments.

The Real Party argues that Petitioner failed to exhaust administrative remedies under SMMC sections 9.31.125(C)(2) and 9.54.070(G)(2). Section 9.54.070(G) provides, in relevant part, as follows:

1. By Subdivider. If the subdivider disagrees with any action by the Planning Commission with respect to the tentative map, the subdivider may, within 10 days of such decision file an appeal in writing with the City Clerk….

2. By Interested Persons. Any interested person, including a member of the Planning Commission or City Council, may file a complaint in writing with the City Council concerning such decision. Any such complaint shall be filed with the City Clerk within 10 days after the action which is the subject of the complaint. No complaint may be filed after the 10 day period….

(Real Party’s Suppl. RJN Exh, L.) Section 9.54.070(C)(2) also states that “[a] tentative map which is deemed approved by the failure of the Planning Commission to act within the required time limit is subject to an appeal within 10 days of the date the tentative map is deemed approved.” (Ibid.) Thus, the administrative remedy in section 9.54.070(G) only applies if the Planning Commission has approved, including by inaction, or denied an application for a tentative map. As discussed, the court cannot determine from the petition and the judicially-noticeable exhibits when, if at all, the City approved the Real Party’s SB 9 application. Thus, it is unclear if the administrative remedy in section 9.54.070(C)(2) was triggered. This order is without prejudice to the Real Party raising this defense at the merits stage.

In reply, the Real Party argues “[i]n the alternative, if the City has not acted on the lot split, then there is no final decision and the [first cause of action] is not ripe for review.” (Real Party’s Reply 10.) The Real Party does not show good cause to raise this argument for the first time in reply. Accordingly, the court does not reach it. (See Balboa Ins. Co. v. Aguirre (1983) 149 Cal.App.3d 1002, 1010.)

Respondents argue that Petitioner has not alleged violations with SB 9 and SMMC section 9.31.125, or the City’s charter. SB 9 requires that the property owner “occupy one of the housing units as their principal residence for a minimum of three years from the date of the approval of the urban lot split.” (Gov. Code § 66411.7(g)(1).) SMMC section 9.31.125 implemented this requirement. (SMMC § 9.31.125(d)(5) & (e)(6).)

1101 Stanford cannot be occupied as a principal residence because it is a vacant lot: The property is a bare patch of land with no structures, habitable or otherwise, and overgrown with weeds. Therefore, Stanford Del Mar cannot comply with the owner occupancy requirement upon final approval of its lot split application and completion of the subdivision.

Even if the vacant lot was habitable, the property owner is an LLC, not a natural person, and unable to occupy 1101 Stanford as a primary residence as a matter of law. On or around February 13, 2024, the City tentatively approved Stanford Del Mar’s lot split application despite its inability to comply with the owner occupancy requirement.

(FAP ¶¶ 7, 8.) Petitioner makes clear: “Petitioner now seeks a peremptory writ of mandate invalidating the City’s tentative approval of the lot split on the basis that a vacant lot cannot be split under SB 9 and that an entity property owner cannot satisfy SB 9’s owner occupancy requirements as a matter of law.” (FAP ¶ 10.)

The court starts by interpreting SB 9 and SMMC section 9.31.125. The rules governing statutory interpretation are clear:

We begin with the fundamental premise that the objective of statutory interpretation is to ascertain and effectuate legislative intent. To determine legislative intent, we turn first to the words of the statute, giving them their usual and ordinary meaning. When the language of a statute is clear, we need go no further. However, when the language is susceptible of more than one reasonable interpretation, we look to a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part.

(Nolan v. City of Anaheim (2004) 33 Cal.4th 335, 340, internal citations omitted.) The plain language of the statutes does not clarify the issue. On its face, Government Code section 66411.7 is not limited to splits of urban lots with existing structures, and nothing in the statute prohibits splitting a vacant lot. To the contrary, there are a series of requirements; lot splitting is permissible if these requirements are met; and each of these requirements could be satisfied with a vacant lot. (See Gov. Code § 66411.7(a)(1)-(3).) Similarly, nothing in SMMC 9.31.125 expressly prohibits splitting vacant lots, and the requirements could be satisfied with a vacant lot. (See SMMC § 9.31.125(a) & (b).) In fact, the plain language of the SMMC suggests that splitting a vacant lot may be permissible because it states that a duplex may be “constructed” after a lot split. (See SMMC § 9.31.125(b)(2).)

However, there is contradictory language in both statutes. Section 66411.7 imposes the owner-occupancy requirement “for a minimum of three years from the date of the approval of the urban lot split.” (Gov. Code § 66411.7(g)(1).) Similarly, section 9.31.125 imposes the owner-occupancy requirement for “3 years after subdivision completion.” (SMMC

§ 9.31.125(d)(5).) This language suggests that there must be an existing structure in order to comply with these requirements.

Respondents do not brief these issues sufficiently, so they do not satisfy their burden of demonstrating that Petitioner’s allegations necessarily fail as a matter of law. Therefore, the demurrer is overruled on this basis.

Government Code section 66411.7 requires “an applicant for an urban lot split to sign an affidavit stating that the applicant intends to occupy one of the housing units as their principal residence for a minimum of three years from the date of the approval of the urban lot split.” (Gov. Code § 66411.7(g)(1).) The SMMC similarly states: “[The] Property owner shall intend to live on one of the resulting parcels for 3 years after subdivision completion.” (SMMC § 9.31.125(d)(5).) Petitioner alleges that the owner is “Stanford Del Mar, LLC.” (Pet. ¶ 2.) The SB 9 application states that the property owner is “Stanford Del Mar, LLC.” (City RJN Exh. A at 7.) The application and affidavit are signed by “Stephen K. Anderson.” (See City RJN Exh. A at 7 & 13.) The court cannot determine based upon the pleadings and the judicially-noticeable evidence whether “Stephen K. Anderson” is the exclusive owner of “Stanford Del Mar, LLC.” Even if so, the parties do not brief whether this is sufficient under the statutes, i.e., whether the statutes apply to the owner-of-record or the beneficial owner. The Real Party argues that Government Code section 66411.7 only requires the “applicant” to sign the affidavit and occupy the residence. However, the SMMC imposes this requirement on the “owner.”

Petitioner argues that the City had a legal duty to deny the Real Party’s SB 9 application because Real Party “failed to comply with the Oaks Initiative which required it to identify all of its officers, directors, partners, and investors to receive the public benefit of a lot split under SB 9.” (FAP ¶ 53.) The Oaks Initiative seeks to address “conflicts of interest among local public officials entrusted with their management and control,” including with respect to “land use decisions conferring substantial private benefits.” (Santa Monica City Charter Section 2201(a); Real Party’s RJN Exh. J.) [2] Attached to the SB 9 application is an Oaks Initiative Disclosure Form, which states that the form is “required for all applications.” (Pet. RJN Exh. 2 at 6, emphasis added.) The form requires the applicant to disclose “all of its trustees, directors, partners, officers, and those with more than a ten percent (10%) equity, participation, or revenue interest in Applicant/Contractor.” (Ibid.) The applicant contractor was Stephen K. Anderson. However, Respondents do not brief the issue whether the term “Applicant/Contractor” would encompass Stanford Del Mar, LLC under the statute as the effective applicant (since it is the property owner of record). Instead, the City argues an interpretation of the Oaks Initiative which is contrary to its own SB 9 form and its purported review process of these applications. Therefore, the demurrer is overruled.

Respondents demur to the second cause of action on the same grounds, and the court overrules the demurrer for the same reasons. As the operative petition is pleaded, Petitioner seeks a writ of ordinary mandate and does not necessarily, or solely, challenge an administrative decision. Thus, the court cannot determine from the face of the pleading that the claim for declaratory relief is barred by Tejon Real Estate, LLC v. City of Los Angeles (2014) 223 Cal.App.4th 149, 154-155. Furthermore, “[a]n action for declaratory relief lies when the parties are in fundamental disagreement over the construction of particular legislation, or they dispute whether a public entity has engaged in conduct or established policies in violation of applicable law.” (City of Cotati v. Cashman (2002) 29 Cal.4th 69, 79.) A general demurrer is usually not an appropriate method for testing the merits of a declaratory relief action “because the plaintiff is entitled to a declaration of rights even if it is adverse to the plaintiff’s interest.” (Qualified Patients Assn. v. City of Anaheim (2010) 187 Cal.App.4th 734, 751.) To the extent the declaratory relief claim is duplicative, the court will address it at the merits stage. Therefore, the demurrer is overruled.

1. The demurrers are overruled. This order is without prejudice to raising the same issues at the merits stage when the court may consider the evidence.

2. The court interprets Petitioner’s opposition as dismissing the third cause of action. Therefore, the third cause of action is dismissed without prejudice.

5. The opening brief shall be filed and served at least 60 days in advance of trial. The opposition brief shall be filed and served at least 30 days in advance of trial. The reply brief shall be filed and served at least 15 days in advance of trial. Since there is no administrative record, the parties shall file declarations/exhibits with their briefs.

[1] SB 9 was recently updated in Senate Bill 450, which took effect on January 1, 2025. (Id. Exh. Z.)

[2] The City of Santa Monica Taxpayer Protection Amendment of 2000 (known as the “Oaks Initiative”), enshrined in Sections 2200 through 2207 of the City Charter, imposes obligations on two categories of people: a “City public official” and a “person or entity who has received a public benefit.” (Charter Section 2203(a); Real Party’s RJN Exh. J.) “Public benefit” is defined in Charter Section 2202(a) to include a “contract, benefit, or arrangement” between the City and a person or entity to do one of seven things, including “confer a land use variance, special use permit, or other exception to a pre-existing master plan or land use ordinance pertaining to real property where such decision has a value in excess of $25,000.” (Ibid.)