The California Supreme Court ruled in favor of the City of Santa Monica late last month and ended a decade-long legal battle with the owner of a multi-unit rental property who allegedly refused to correct dangerous code violations at the property.
The court upheld the appointment of a receiver to take over the property. The court also upheld the receiver’s decision to demolish the building, a city attorney spokesman said.
“We are glad that the court preserved the flexibility of this important remedy for cities and for tenants,” said Deputy City Attorney Adam Radinsky. “Apartment owners need to know that they must correct code violations within a reasonable time. Receivership is drastic medicine, but we won’t hesitate to use it in proper cases to protect the well-being of the community.”
In December 2004, the Consumer Protection Unit of the Santa Monica City Attorney’s Office originally filed the civil lawsuit on behalf of the city against the building owner, Guillermo Gonzalez.
In January 2005, Judge Lisa Hart Cole of the Beverly Hills Superior Court appointed a receiver to take control of the three-unit property located at 2438 Ocean Park Blvd. The court found that the property was in a chronic state of severe disrepair and had become a dangerous blight to the community.
The health and safety code violations at the property, according to the court, included:
… The exterior was overrun with garbage, flammable materials, and litter;
… In a single bedroom on the second floor, there were seven bunk beds being individually rented out by the week; and
… Due to the squalid and littered condition of the kitchen and dining area of the main unit, the front yard has been converted to a makeshift dining area with a refrigerator, microwave, TV, and the storage of food.
In addition, the property lacks heating in any of its units.
Temporary extension cords are used in place of proper electrical wiring throughout the building, and the property has been the site of chronic criminal activity for many years, Radinsky said.
The city had received numerous complaints about the property from neighbors. Twice in the past decade, the city attorney’s office had filed criminal charges against Gonzalez to compel him to bring the building into compliance. Gonzalez was convicted on both occasions and served time at the Los Angeles County Jail for refusing to make the repairs.
The Consumer Protection Unit finally sought a court-appointed receiver as a last resort to assure that the property be made safe and legal, Radinsky said.
In May 2005, David Pasternak, the receiver, requested the court’s permission to demolish the building in light of the fact that it was not financially feasible to rehabilitate the property due to the longstanding and extensive nature of the code violations. The court granted his request.
Gonzalez argued to the Court of Appeal that the city had not complied with certain technical requirements of the receivership law, and that demolition would be unfair since he wished to remain living in the building and preferred to pay the cost of repairs instead.
In June 2006, the Court of Appeal ruled that the receivership was proper. It held that any technical deviations from the statute by the city did not prejudice Gonzalez since he had adequate notice of the violations. The court also held that it was reasonable to allow the demolition of the building since rehabilitation was not economically feasible.
The California Supreme Court granted Gonzalez’s petition for review from that decision and heard oral arguments on March 6th.
The state Supreme Court’s decision upheld the Court of Appeal’s ruling in every respect, Radinsky said. The court noted that judges have broad discretion in appointing receivers and in overseeing their actions and recommendations for problem properties.