HomeMy WebLinkAbout20260310_Memorandum of Points and Authorities ISO Application- City_City v Smith
NOTICE OF AND EX PARTE APPLICATION
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CIV
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LAW
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J. CHRISTINE DIETRICK, SBN 206539
City Attorney, City of San Luis Obispo
MATTHEW R. SILVER, SBN 245528
MSilver@CivicaLaw.com
SEAN E. MORRISSEY, SBN 297371
SMorrissey@CivicaLaw.com
NICHOLAS GARCÉS, SBN 273277
NGarces@CivicaLaw.com
CIVICA LAW GROUP APC
4000 Barranca Parkway, Suite 250, PMB #782
Irvine, California 92604
Phone: 949-592-0165
Fax: 949-335-1701
Attorneys for Plaintiffs
City of San Luis Obispo, and
People of the State of California
Exempt from filing fees pursuant to
Government Code section 6103.
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SAN LUIS OBISPO
THE PEOPLE OF THE STATE OF
CALIFORNIA, EX REL, J. CHRISTINE
DIETRICK, CITY ATTORNEY OF THE CITY
OF SAN LUIS OBISPO; and,
THE CITY OF SAN LUIS OBISPO, a California
municipal corporation,
Plaintiff,
v.
LAUREL CREEK, LP, a California Limited
Partnership;
LAUREL CREEK, II, L.P., a Delaware limited
partnership;
1160 LAUREL LANE, LLC, a California limited
liability company;
PATRICK N. SMITH a/k/a PATRICK SMITH,
an individual;
SMITH AND COMPANY, A REAL ESTATE
INVESTMENT DEVELOPMENT
CORPORATION, a California corporation;
PATRICK N. SMITH a/k/a PATRICK SMITH,
AS TRUSTEE OF THE PATRICK N SMITH
2004 LIVING TRUST;
Case Number: 25CV-0667
Action Filed: October 16, 2025
Judge: Hon. Tana L. Coates
Dept.: 4
MEMORANDUM OF POINTS AND
AUTHORITIES IN SUPPORT OF
PLAINTIFF CITY OF SAN LUIS OBISPO’S
EX PARTE APPLICATION FOR
APPOINTMENT OF RECEIVER, OR
ALTERNATIVELY, FOR AN ORDER
SHORTENING TIME
Filed concurrently with:
1. Ex Parte Receivership Application;
2. Declaration Code Enforcement Supervisor
John Mezzapesa;
3. Declaration of Building Inspector Trevor
Nelson;
4. Declaration of Fire Marshal Josh Daniel;
5. Declaration of Attorney Sean Morrissey;
6. Declaration of Proposed Receiver Kevin
Singer;
7. Request for Judicial Notice;
8. Appendix of Exhibits;
9. [Proposed] Receivership Order;
10. Proof of Service.
ELECTRONICALLY FILED3/10/2026 9:29 AM
NOTICE OF AND EX PARTE APPLICATION
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CPIF CALIFORNIA LLC, a California limited
liability company;
CPIF LAUREL CREEK, LLC, a Washington
limited liability company;
ALL WALL SYSTEMS, INC., a Delaware
corporation;
AMERICAN RIVIERA BANK, a California
corporation;
ARNOLD BUILDERS, INC., a California
corporation;
B & B CONSTRUCTION CLEANUP INC., a
California corporation;
BLUE STEEL CONCRETE, LLC, a California
limited liability company;
COAST ENGINEERING & DESIGN INC., a
California corporation;
CONSOLIDATED ELECTRICAL
DISTRIBUTORS, INC., d/b/a CALIFORNIA
ELECTRICAL SUPPLY, a Delaware corporation;
CULBERT PLUMBING INC., F/K/A CULBERT
CONSTRUCTION AND PLUMBING, INC., a
California stock corporation;
EMPIRE ELECTRICAL SOLUTIONS, INC., a
California corporation;
FAMCON PIPE & SUPPLY, INC., a California
corporation;
G W SURFACES, a California corporation;
HOMER T. HAYWARD LUMBER CO., a
California corporation;
KIRK CONSTRUCTION, a California
corporation;
LC LENDERS, LLC, a Delaware limited liability
company;
LW CONSTRUCTION, INC., a California
corporation;
MAHOGANY CONSTRUCTION, INC., a
California corporation;
NOLAN CHURCH DOING BUSINESS AS
COLORTRENDS PAINTING & DECORATING,
a California sole ownership or proprietor business;
SCHINDLER ELEVATOR CORPORATION, a
Delaware corporation;
THE SHERWIN-WILLIAMS COMPANY, an
Ohio corporation;
UNITED RENTALS (NORTH AMERICA) INC.,
a Delaware corporation;
US AIR CONDITIONING DISTRIBUTORS,
LLC, a Delaware limited liability company; and,
DOES 1 through 50, inclusive,
Defendants.
Hearing:
Date: March 12, 2026
Time: 8:30 a.m.
Dept: 4
Trial: None Set
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TABLE OF CONTENTS
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TABLE OF CONTENTS
I. INTRODUCTION ............................................................................................................................ 1
II. STATEMENT OF FACTS ............................................................................................................... 2
A. Subject Property Information and Ownership ......................................................................................... 2
B. The Subject Property’s History And Its Existing Substantially Dangerous Conditions ...................... 2
III. ARGUMENT ................................................................................................................................ 6
A. A Court Receiver Must Be Appointed to Abate the Subject Property’s Unlawful and Dangerous
Conditions .......................................................................................................................................................... 6
1. The Subject Property Is Substandard and Substantially Endangers the Health and Safety of any
Occupants, the Community, and the Public ...................................................................................... 7
2. The Court Must Give Deference to the Determinations of Public Officials that the Subject
Property is Substantially Dangerous ................................................................................................. 7
3. Defendant Owners Have Been Given More than a Reasonable Opportunity to Correct the
Substandard Nuisance Conditions on the Subject Property ............................................................. 8
4. The City Has Complied with the Procedural Prerequisites for Appointing a Court Receiver . 9
B. The Legislature Enacted the Receivership Statutes for this Exact Scenario ......................................... 9
1. The Health and Safety of the Community Is a Top Priority, and California Law Provides the
Basis for a Receivership when Community Safety Is Threatened ................................................... 9
2. The California Supreme Court Has Upheld the Appointment of a Court Receiver under the
HSC on Much Less Drastic Facts ................................................................................................... 10
3. While Not Necessary Under the Statutes, Other Remedies Are Inadequate or Infeasible,
Further Supporting Receivership Relief ......................................................................................... 11
C. The Proposed Court Receiver Is Capable of Carrying out the Duties of a Receivership and Must Be
Allowed to Perform Those Duties Without Interference by the Defendant ................................................12
1. The Proposed Court Receiver Has Demonstrated the Necessary Capacity and Expertise to
Develop and Supervise a Viable Rehabilitation Plan ..................................................................... 12
2. Defendant Owners and Those Acting for Them Must Be Enjoined from Interfering with the
Court Receiver’s Rehabilitation of the Subject Property ............................................................... 12
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3. The Court Receiver Should Be Authorized to Secure the Debts of the Receivership Estate with
Super Priority Liens on the Subject Property ................................................................................. 13
D. The City Is Entitled to Recover Its Expenses, Costs, and Fees Associated with this Action Out of the
Receivership Estate ..........................................................................................................................................13
E. Alternative Relief for Request for an Order to Shorten Time ..............................................................14
IV. CONCLUSION........................................................................................................................... 14
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TABLE OF AUTHORITIES
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TABLE OF AUTHORITIES
CASES
Asociacion de Gente Unida por el Agua v. Central Valley Regional Water Quality Control Bd. (2012)
210 Cal.App.4th 1255 ........................................................................................................................... 8
City and County of San Francisco v. Daley (1993) 16 Cal.App.4th 734 ............................................... 11
City of Crescent City v. Reddy (2017) 9 Cal.App.5th 458 .............................................................. 7, 8, 11
City of Desert Hot Springs v. Irene Valenti (2019) 43 Cal.App.5th 788 ............................................ 7, 12
City of Riverside v. Horspool (2014) 223 Cal.App.4th 670; Title Ins. & Trust Co. v. California
Development Co. (1915) 171 Cal. 227 ............................................................................................... 13
City of Santa Monica v. Gonzalez (2008) 43 Cal.4th 905 .................................................................. 9, 10
City of Santa Paula v. Narula (2003) 114 Cal.App.4th 485 ................................................................... 14
City of Sierra Madre v. Suntrust Mortgage (2019) 32 Cal.App.5th 648 ................................................ 13
Guinnane v. San Francisco City Planning Com. (1989) 209 Cal.App.3d 732 ......................................... 8
Harrott v. City of Kings (2001) 25 Cal.4th 1138 ...................................................................................... 8
Winslow v. Harold Ferguson (1944) 25 Cal. 2d 274 .............................................................................. 14
Yamaha Corp. of America v. State Bd. of Equalization (1998) 19 Cal.4th 1 ........................................... 8
STATUTES
California Rules of Court, rule 3.1300 ................................................................................................... 14
Code of Civil Procedure section 1005(b) ............................................................................................... 14
Code of Civil Procedure section 128 ...................................................................................................... 14
Government Code section 38773.5 ......................................................................................................... 14
Government Code section 53935 ............................................................................................................ 14
Health and Safety Code section 17980(b) .............................................................................................. 11
Health and Safety Code section 17980.6 ........................................................................................ 6, 9, 10
Health and Safety Code section 17980.7(a) ............................................................................................. 9
Health and Safety Code section 17980.7(c) ......................................................................... 5, 6, 9, 11, 13
Health and Safety Code section 17980.7(c)(1) ......................................................................................... 7
Health and Safety Code section 17980.7(c)(11) ..................................................................................... 14
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TABLE OF AUTHORITIES
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Health and Safety Code section 17980.7(c)(2) ................................................................................... 7, 12
Health and Safety Code section 17980.7(c)(3) ....................................................................................... 12
Health and Safety Code section 17980.7(c)(4)(G) ........................................................................... 13, 14
Health and Safety Code section 17980.7(d)(1) ....................................................................................... 14
Revenue & Taxation Code section 2192.1 ............................................................................................. 14
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MEMORANDUM OF POINTS AND AUTHORITIES
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MEMORANDUM OF POINTS AND AUTHORITIES
I. INTRODUCTION
Plaintiff, the City of San Luis Obispo (“City”), has attempted to gain voluntary compliance from
Defendants Laurel Creek, L.P. (“Defendant Laurel Creek LP”) and Laurel Creek II, L.P. (“Defendant
Laurel Creek II LP”) (collectively, “Defendant Owners” or “Owners”), and any other interested party,
to abate the numerous substandard and dangerous conditions on the real property located at a 1150 Laurel
Lane, San Luis Obispo, CA 95205, 004-962-036, 004-962-037, and 004-962-042 (“Subject Property”)
to no avail. The Subject Property consists of multiple large parcels of approximately 8.6-acres
containing an approximately 200,000 plus square foot development project with a warehouse, storage
units, and an incomplete, unpermitted, substandard, unsafe and red tagged two-story, mixed-use structure
with approximately twelve (12) separate commercial suites located on the first floor, and partially
constructed apartment/dwelling units on the second floor, all of which contain violations of state and
local laws.
The Subject Property is plagued with immediately dire health, safety, fire, and other hazards
posing substantial dangers to any entrants, neighbors, and the community. The Owners, and any other
interested party, have failed to fix or correct the immediate and substantial dangers. As described in
detail below, from the time the City identified the approximately 274 substantially dangerous and
hazardous violations in September of 2025, the condition of the Subject Property is no better and has
even become worse.
The City is thus forced to file this Ex Parte Application for Appointment of a Receiver
(“Receivership Application”) to obtain an order appointing a receiver to take possession and control of
the Subject Property to bring it into compliance with the law and alleviate the substantial dangers posed
thereon. While the City was unable to procedurally bring this Receivership Application until the twenty-
nine (29) named defendants were each served, filed an answer, or were defaulted or dismissed, which
took up to March to complete—all while Defendant Owners failed to address the conditions at the
Subject Property—the City now brings this application in light of the urgent need for a receiver to be
appointed to bring the Subject Property to a safe condition to protect the community and the public. All
procedural prerequisites for this relief have now been met: Defendant Owners have had more than
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reasonable time to comply with the City’s Health and Safety Code (“HSC”) Notice and Order to Repair
or Abate; the City provided advance notice of the City’s filing of this action; and, the City nominated a
qualified receiver. This Receivership Application is ripe and proper to be granted.
Defendant Owners have demonstrated that they are unable or unwilling to remediate the Subject
Property without this Court’s intervention.
The City can wait no longer as this action is in the interest of protecting the public, and the next
available regularly noticed motion hearing date is not until August 2026. Further harm is likely to occur
if relief is held off until then. The City therefore requests that the Court grant this Receivership
Application so that the violations can be fully and finally abated to protect the community.
Alternatively, the City requests that the Court specially set a hearing date on the first available
date that is convenient for the Court.
II. STATEMENT OF FACTS
A. Subject Property Information and Ownership
Defendant Owners - essentially entities controlled or managed by Defendant Patrick N. Smith
(“Defendant P. Smith”) or companies he manages in some way - are the record owners of the Subject
Property pursuant to a Grant Deed recorded on June 24, 2020, (“Grant Deed 1”), and a second Grant
Deed recorded on April 1, 2021, both recorded in the County of San Luis Obispo. (Declaration of
Attorney Sean E. Morrissey (“Morrissey Decl.”), ¶¶ 2-4; Declaration of Code Enforcement Supervisor
Mezzapesa (“Mezzapesa Decl.”), ¶¶ 6, 10; Declaration of Deputy Building Inspector Nelson (“Nelson
Decl.”), ¶ 5; Appendix of Exhibits (“AOE.”), Ex. 1 [Grant Deeds]; Request for Judicial Notice (“RJN”),
¶ 1.) Aside from Defendant Owners’ Grant Deeds on title, the other recorded interests on title largely
include liens from banks/lenders securing their loans on the Subject Property, including for some banks
which lent money on construction projects, and many mechanic’s liens from contractors or
subcontractors who performed work at the Subject Property. (Morrissey Decl., ¶¶ 5-15.)
B. The Subject Property’s History And Its Existing Substantially Dangerous Conditions
The Subject Property consists of multiple large parcels of approximately 8.6-acres containing an
approximately 200,000 plus square foot development project with a warehouse, storage units, and an
incomplete, unpermitted, substandard, unsafe and red tagged unoccupiable two-story, mixed-use
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structure with approximately twelve (12) separate commercial suites located on the first floor, and
partially constructed apartment/dwelling units on the second floor, all of which contain violations of
state and local laws. (Mezzapesa Decl.., ¶ 8; Nelson Decl., ¶ 8; Declaration of Fire Marshal Josh Daniel
(“Daniel Decl.”), ¶¶ 6, 12.) The Subject Property is plagued with numerous unlawful violations of
State and local laws, including laws relating to health, building, and fire safety, which render the
Subject Property substantially dangerous to the owners, entrants, occupants, neighbors, and the
community. (Ibid.) Exacerbating this danger is the fact that the Subject Property is located in a densely
populated area near many businesses, parks, churches, residences, a museum, and schools and poses a
significant danger to them. (Ibid.) The Subject Property is unsafe, unsanitary, and various structures on
it are structurally unsound, leading to City staff prohibiting occupancy of the Subject Property, including
requiring CalFire offices, a church, and other businesses to permanently vacate the property. (Mezzapesa
Decl.., ¶¶ 8, 17, 23, 31-39; Nelson Decl., ¶¶ 8, 18-19, 23-30, 33; Daniel Decl., ¶¶ 8-13, 16-20.)
Some of the violative conditions on the Subject Property include, but are not limited to:
unoccupiable and unhabitable red tagged property; incomplete or lacking fire safety requirements,
systems, and safeguards; first floor office suites, second floor, apartment/dwelling units, and exterior
structure in various states of construction with significant unpermitted, unauthorized, and/or incomplete
and unfinished work; and, many dangerous, substandard, and hazardous conditions caused by a pattern
of unpermitted construction, unauthorized occupancy, and building activity that compromises public
safety; among many other violations. (Mezzapesa Decl., ¶¶ 8, 30-31; Nelson Decl., ¶¶ 8, 18-31; Daniel
Decl., ¶¶ 13, 16-20; AOE, Ex. 11 [Notice of Pendency of Nuisance Abatement Action with the Notice
and Order to Repair or Abate]; RJN, ¶ 11.)
By 2020 Defendant Owners made the Subject Property a site of significant development and
construction. (Mezzapesa Decl., ¶ 10.) Around 2020, at least fourteen (14) building, fire, and grading
permits were applied for and issued to Defendant Laurel Creek LP and Defendant P. Smith, as an
authorized agent, or their contractors. (Mezzapesa Decl., ¶¶ 10-11; Nelson Decl., ¶¶ 9-12.) Around that
time, the City saw a shift in development, with multiple permits filed for residential and assembly
conversions. (Ibid.) These included plans for adding multi-family units to both stories; accessibility
upgrades; converting warehouse spaces into large assembly spaces; and, upgrading fire separations and
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building systems to meet code requirements, among other projects. (Ibid.)
Soon after the 2020 building permits were issued, the Subject Property became the focus of the
City’s code enforcement efforts, largely related to an ongoing pattern of unpermitted construction,
unauthorized occupancy, and building activity that compromises public safety. (Mezzapesa Decl., ¶ 12;
Nelson Decl., ¶¶ 12-18.)
From 2021 to 2025, the City issued at least five Notices of Violation (“NOV”) (including for
substandard conditions, unpermitted construction, unlawful occupancy, building code violations, fire
safety related dangers, serious hazards, and other violations of law) requiring compliance; the City
recorded a Notice of Abatement Proceedings; the Temporary Occupancy Certificates for eight first floor
office suites expired (leaving people and business without occupancy); at least twenty (20) projects
remained incomplete with expired permits; and, the City conducted several inspections revealing the
significant dangers and extent of the unpermitted and unfinished construction inside and out.
(Mezzapesa Decl., ¶¶ 13-29; Nelson Decl., ¶¶ 10-18; Daniel Decl., ¶¶ 7-12; AOE, Ex. 2 [2021 to 2022
NOVs], Ex. 3 [Temporary Occupancy Certificates], Ex. 4 [March 10, 2025, NOV], Ex. 5 [March 13,
2025, Photos], Ex. 6 [Notice of Abatement Proceedings], Ex. 7 [April 25, 2025, Photos], Ex. 8 [April
30, 2025, Photos]; RJN, ¶¶ 2-8.)
In 2025, the City’s Construction Board of Appeals (CBOA) also upheld a 2025 NOV after
Defendant Owners appealed it, and the CBOA issued a resolution confirming portions of the building
were dangerous and upheld an order to vacate and secure dangerous portions of the building from
entry. (Mezzapesa Decl., ¶ 23; AOE, Ex. 9 [CBOA Resolution]; RJN, ¶ 9.)
On September 2, 2025, the City issued a Notice and Order to Repair or Abate (“N&O”) —
pursuant to HSC sections 17980 and 17980.6, which the City also recorded on title to the Subject
Property, citing 274 substantially dangerous and hazardous violations of state and local laws at the
Subject Property, and requiring corrective action and full compliance within 30 days, by October 2,
2025. (Mezzapesa Decl., ¶¶ 30-33; Morrissey Decl., ¶¶ 16-19; Nelson Decl., ¶¶ 18-22; Daniel Decl., ¶¶
14-15; AOE Ex. 10, [September 2, 2025, NoP Posting Photographs], Ex. 11; RJN, ¶¶ 10-11.) Defendant
Owners and other interested parties have failed to bring the Subject Property into compliance or even
take any meaningful corrective action. (Mezzapesa Decl., ¶¶ 34-39; Nelson Decl., ¶ 23; Daniel Decl., ¶
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16; AOE Ex. 12 [October 3, 2025, Photos], Ex. 14 [December 8, 2025, Photos], Ex. 15 [February 27,
2026, Photos].)
On October 3, 2025, a 3-Day Notice was posted and mailed to all interested parties regarding
the City’s intent to file a complaint under HSC section 17980.7, subdivision (c). (Morrissey Decl., ¶ 21;
AOE Ex. 12, 13 [3-Day Notice and Proofs of Service]; RJN, ¶¶ 12, 13.)
From October 2025 until now, neither Defendants Owners nor any other interested party have
taken any significant corrective actions, and the 274 violations remain and worsen as the Subject
Property deteriorates further. (Mezzapesa Decl., ¶¶ 34-48; Nelson Decl., ¶¶ 23-30; Daniel Decl., ¶¶ 16-
21; AOE Exs. 12-15.) Numerous permits are expired; the Subject Property still sits full of dangers and
hazards from significant unfinished and unpermitted construction; unfinished exterior structural
elements and building materials left out in winter weather and rain have become more deteriorated and
dilapidated; various areas of the Subject Property have become a dumping ground with a large
accumulation of junk, trash, debris; and, the lack of necessary permits or corrective action to the exterior
areas reflect the interior is also in the same or worse conditions without any sign of improvement
anytime soon, without this court’s intervention. (Mezzapesa Decl., ¶ 39; Nelson Decl., ¶¶ 23-36; Daniel
Decl., ¶¶ 16-22; AOE Exs. 12, 14-15.)
The conditions on the Subject Property are so extensive and contain numerous building, fire, and
health-safety violations that pose an immediate and substantial danger to the health and safety of
neighboring properties, the public, occupants, and the community at large. (Mezzapesa Decl., ¶¶ 40-
48; Nelson Decl., ¶¶ 25-36; Daniel Decl., ¶¶ 16-22.) Defendant Owners have failed to take action to
abate and remove the extremely serious and dangerous conditions and hazards at the Subject Property
and remain unable and/or unwilling to resolve the worsened conditions and extensive violations that are
a serious danger to people and the community.
The City has used all reasonable efforts to gain Defendant Owners’ or any interested party’s
voluntary compliance to no avail. (Mezzapesa Decl., ¶ 43; Nelson Decl., ¶¶ 13, 24, 32.) In order to
protect the health and safety of any occupants and the public, all of these dangerous and unlawful
conditions need to be abated immediately. (Mezzapesa Decl., ¶ 48; Nelson Decl., ¶ 36; Daniel Decl., ¶¶
21-22.) Expedient relief is needed in this court action. (Ibid.) As such, the City has no other viable
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option and is therefore forced to seek receivership relief to halt the substantial dangers on the Subject
Property. (Mezzapesa Decl., ¶¶ 40, 48; Nelson Decl., ¶ 36; Daniel Decl., ¶ 22; Morrissey Decl., ¶ 23.)
Immediate relief is needed: the next available hearing for a regularly noticed motion is not until
August 2026, and further harm is likely to occur between now and then. (Morrissey, Decl., ¶ 30.) The
City provided more than two days’ notice of this Receivership Application in an abundance of caution,
to Defendant Owners and other Defendants. (Id. at ¶ 27.)
III. ARGUMENT
A. A Court Receiver Must Be Appointed to Abate the Subject Property’s Unlawful
and Dangerous Conditions
HSC section 17980.7, subdivision (c), authorizes the Court to appoint a court receiver to enable
the rehabilitation of a substandard property if the property owner fails to comply with an order or notice
to repair or abate issued by a local code enforcement agency pursuant to HSC section 17980.6. HSC
section 17980.6 allows a local agency to issue an order or notice to a property owner to repair a building
if: (1) the building is maintained in violation of state housing law or any law promulgated by a local
agency pursuant thereto; and (2) the extent and nature of the violations are such that “the health and
safety of the residents or the public is substantially endangered.” If the property owner does not correct
the conditions within a “reasonable time” after the notice or order is issued, an enforcement agency may
seek the appointment of a court receiver to oversee the management, repair, and rehabilitation of the
property. Specifically, HSC section 17980.7, subdivision (c), states:
If the owner fails to comply within a reasonable time with the terms of the order or notice
pursuant to Section 17980.6 . . . [t]he enforcement agency . . . may seek and the court may
order, the appointment of a receiver for the substandard building . . . .
Finally, notice of the enforcement agency’s intention to seek appointment of a court receiver over
the substandard property must be served on all persons with a recorded interest in the property at least
three days prior to filing the complaint to appoint the court receiver. (HSC, § 17980.7, subd. (c).) As
detailed below, each of these prerequisites have been satisfied.
Furthermore, in determining whether appointment of a court receiver is warranted in a particular
case, the Court may only consider two factors: (1) “whether the owner has been afforded a reasonable
opportunity to correct the conditions cited in the notice of violation” and (2) whether the proposed
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receiver “has demonstrated to the court his or her capacity and expertise to develop and supervise
a viable financial construction plan for the satisfactory rehabilitation of the building”. (HSC §
17980.7, subd. (c)(1), (2); City of Desert Hot Springs v. Irene Valenti (2019) 43 Cal.App.5th 788, 794
[Emphasis Added].) Consideration of any other factors, such as the economic feasibility of carrying out
the rehabilitation pursuant to the appointment of a receiver, is an abuse of discretion which is subject to
reversal on appeal. (Ibid.) Additionally, in support of its receivership motion, the City is not required
to show that it considered other alternatives, even though in this case the City engaged in years of less
drastic alternatives, to no avail. (City of Crescent City v. Reddy (“Reddy”) (2017) 9 Cal.App.5th 458,
467.)
1. The Subject Property Is Substandard and Substantially Endangers the
Health and Safety of any Occupants, the Community, and the Public
As set forth in the accompanying declarations of Senior Code Enforcement Supervisor John
Mezzapesa, Supervising Building Inspector Trevor Nelson, and Fire Marshal Josh Daniel, the Subject
Property is replete with extensive and dangerous violations of State and local laws and poses an
immediate and substantial danger to the health and safety of the public, entrants, occupants, and the
community at large. (Mezzapesa Decl., ¶¶ 31, 41; Nelson Decl., ¶ 31; Daniel Decl., ¶ 12.) The City’s
N&O detailed 274 substantially dangerous and hazardous violations of law, which remain to this day
as evidenced by the City inspectors’ declarations and recent inspection photographs. (Mezzapesa Decl.,
¶¶ 30-31, 39-47; Nelson Decl., ¶¶ 18, 30; Daniel Decl., ¶¶ 12-13, 16-21; AOE Exs. 11, 12, 14, 15; RJN,
¶¶ 11, 12, 14, 15.) In its present state, the Subject Property is a structural hazard, unsanitary,
unoccupiable/uninhabitable, manifestly unsafe, a fire hazard, and a public nuisance. (Mezzapesa
Decl., ¶¶ 40-48); Nelson Decl., ¶¶ 18, 25-30; Daniel Decl., ¶¶ 8-13, 16-21.)
2. The Court Must Give Deference to the Determinations of Public Officials
that the Subject Property is Substantially Dangerous
The City is confident the Court would independently conclude that the Subject Property is
substantially dangerous. Nonetheless, the City’s officials have resolutely determined during inspections
of the Subject Property that it contains numerous building and health and safety violations that
substantially endanger the health and safety of the public, visitors, and City residents. (Mezzapesa Decl.,
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¶¶ 30-31, 40-48; Nelson Decl., ¶¶ 18, 25-31, 34; Daniel Decl., ¶¶ 8-13, 16-21.) Pursuant to established
case law, and California Supreme Court decisions, the Court must give deference to the determination
of public officials, as they are neutral, trained, and certified experts on inspecting and identifying
violations of State and local building code standards. (See, e.g., Yamaha Corp. of America v. State Bd.
of Equalization (1998) 19 Cal.4th 1; Asociacion de Gente Unida por el Agua v. Central Valley Regional
Water Quality Control Bd. (2012) 210 Cal.App.4th 1255, 1268; Harrott v. City of Kings (2001) 25
Cal.4th 1138, 1155; Guinnane v. San Francisco City Planning Com. (1989) 209 Cal.App.3d 732, 738.)
The declarations of the City Code Enforcement Supervisor, Senior Building Inspector, and Fire Marshal
are a sufficient basis to justify appointment of a receiver. (Reddy, supra, 9 Cal.App.5th at p. 467 [city
employee declarations “fully support” conclusion of existence of code violations which pose threat to
health and safety of occupants and public].) Moreover, the Court does not need to make a finding that
the Subject Property is substantially dangerous to appoint a receiver, but it clearly is substantially
dangerous. (Ibid.)
The City’s inspectors are charged with the duty and responsibility of enforcing building standards
to protect public health and safety. The City’s inspectors are highly trained experts, and they have an
intimate knowledge of the HSC, the California Building Code (“CBC”), the California Electrical Code
(“CEC”), the California Fire Code (“CFC”), the California Mechanical Code (“CMC”), the California
Plumbing Code (“CPC”), the International Property Maintenance Code (“IPMC”), the Uniform Code
for Abatement of Dangerous Buildings (“UCADB”), the San Luis Obispo Municipal Code (“SLOMC”).
The provisions of these codes are detailed and very technical. The City’s officials are trained, unbiased,
and in the best position to identify what constitutes an unsafe or substandard building under the building
and housing codes. The Court must give deference to their determination that the Subject Property is
substantially dangerous, and thus the declarations of City building and code enforcement officers are a
sufficient basis to justify the appointment of a receiver. (Reddy, supra, 9 Cal.App.5th at 467.)
3. Defendant Owners Have Been Given More than a Reasonable Opportunity
to Correct the Substandard Nuisance Conditions on the Subject Property
The City’s N&O gave Defendant Owners more than sufficient time to complete the rehabilitation
of the Subject Property given the immediate dangers it poses. Since the N&O was issued, Defendant
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Owners have had more than 180 days, or six (6) months, to remedy the violations on the Subject
Property. (Mezzapesa Decl., ¶¶ 32-48; Nelson Decl., ¶ 24; Daniel Decl., ¶ 21.) Subsequent inspections
demonstrate that the violative conditions identified in the September 2, 2025, N&O still exist on the
Subject Property. (Mezzapesa Decl., ¶¶ 36-45; Nelson Decl., ¶¶ 25-31; Daniel Decl., ¶¶ 16-21 AOE Ex.
12, 14, 15; RJN, ¶ 12, 14, 15.) As of the date of this Application and with over six months since the
N&O was issued, Defendant Owners have failed to remedy the violations. Based on the foregoing, it
stands to reason that the Subject Property will never be safe without court intervention through the
appointment of a court receiver.
4. The City Has Complied with the Procedural Prerequisites for Appointing a
Court Receiver
The City has complied with all the procedural prerequisites for the appointment of a court
receiver pursuant to HSC section 17980.7, subdivision (c). The N&O was properly issued pursuant to
HSC section 17980.6. (Morrissey Decl., ¶¶ 16-18; Mezzapesa Decl., ¶ 32; Nelson Decl., ¶ 19; Daniel
Decl., ¶ 14.) Furthermore, the N&O afforded Defendant Owners a reasonable time to rehabilitate the
Subject Property pursuant to HSC section 17980, subdivision (a). The City served Defendants with more
than three days advance notice (“3 Day Notice”) of the City’s intent to file the Verified Complaint for
the Appointment of a Receiver as required by HSC section 17980.7, subdivision (c). (Morrissey Decl.,
¶ 21; Mezzapesa Decl., ¶ 36; AOE Ex. 12, 13; RJN, ¶¶ 12, 13.) The appointment of a court receiver is
substantively and procedurally appropriate.
B. The Legislature Enacted the Receivership Statutes for this Exact Scenario
1. The Health and Safety of the Community Is a Top Priority, and California
Law Provides the Basis for a Receivership when Community Safety Is
Threatened
The legislature enacted the health and safety receivership statutes for this very situation, as
clearly evidenced by the legislative intent. In City of Santa Monica v. Gonzalez, the California Supreme
Court detailed the legislative intent behind these statutes:
[T]he legislative history of section 17980.6 as originally enacted discloses the Legislature's
substantial concern over the “inadequate enforcement of State Building Codes in regard to
substandard housing” and its intent to provide “new enforcement measures to rehabilitate
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and maintain existing housing that currently endangers the health and safety of residents
or the public.”
(City of Santa Monica v. Gonzalez [“Gonzalez”] (2008) 43 Cal.4th 905, 925–26 (emphasis added).) The
Supreme Court reiterated that HSC section 17980.6 “serves to enhance the ability of local enforcement
agencies to require defendants to remediate substandard housing conditions” that pose a substantial
danger. (Id. at 926.) In other words, the legislature was concerned that cities were not adequately
enforcing state building codes, and as such, enacted the receivership statutes to “enhance” their ability
to cause remediation of substandard buildings that threaten community safety.
This is precisely the situation in this case. Here, as clearly evidenced in the Appendix of Exhibits,
the declarations of the City’s officials, and the other evidence filed herewith, the Subject Property
contains numerous conditions that endanger the health and safety of the occupants and the surrounding
community. (Mezzapesa Decl., ¶¶ 40–48; Nelson Decl., ¶¶ 8, 18, 25-36; Daniel Decl., ¶¶ 12-13, 16-22;
AOE, Exs. 11, 12, 14, 15.) The legislature, as reiterated by the Supreme Court, mandates the
appointment of a court receiver over substandard and substantially dangerous properties, such as the
Subject Property.
2. The California Supreme Court Has Upheld the Appointment of a Court
Receiver under the HSC on Much Less Drastic Facts
In Gonzalez, the California Supreme Court upheld appointment of a receiver in lesser
circumstances. There, the City of Santa Monica had been trying to gain compliance from a property
owner for more than a decade. (Gonzalez, supra, 43 Cal.4th at p. 913.) The property contained violations
of the uniform building, fire, mechanical, plumbing, and electrical codes, and unpermitted buildings, but
they were less severe than those at the Subject Property. (Id. at pp. 914–15 [violations generally were
exterior accumulation of junk and debris, improper use of extension cords, and lack of heating].) Santa
Monica tried various compliance efforts prior to seeking a receivership. (Id. at pp. 913–14.) However,
since the property owner refused to comply, Santa Monica was finally forced to seek a receivership,
which the trial court granted. (Id. at pp. 914–16.) In upholding that decision, the Supreme Court referred
to the violations—which were less extreme than those on the Subject Property—as being “extremely
unsafe and unsanitary condition[s] that endanger its occupants and neighbors.” (Id. at p. 913.) The
Supreme Court noted that, with just over 30 days to comply, Santa Monica had given the property owner
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“more than an adequate and reasonable period of time” to correct the violations and, given the owner’s
failure to do so, the appointment of a court receiver was warranted. (Id. at p. 928.)
Here, even more severe conditions exist on the Subject Property. (Mezzapesa Decl., ¶¶ 30-48;
Nelson Decl., ¶¶ 8, 18, 25-36; Daniel Decl., ¶¶ 12-13, 16-22; Exs. 7, 8, 10-12, 14, 15; RJN, ¶¶ 4, 7-8,
10-11, 12, 14-15.) As the California Supreme Court agreed, these violations are dangerous enough to
warrant the appointment of a court receiver. The City has provided an abundance of competent and
qualified evidence showing not only the substandard nature of the conditions on the Subject Property,
but also that it is substantially dangerous. Further, the City provided more than ample time for the
Defendant Owners to rehabilitate it if they could.
3. While Not Necessary Under the Statutes, Other Remedies Are Inadequate or
Infeasible, Further Supporting Receivership Relief
Before seeking the appointment of a receiver, the City does not need to consider other remedies.
(Reddy, supra, 9 Cal.App.5th at p. 467.) However, even if the City were to consider other alternatives,
there are none available in this case. Abatement through direct City rehabilitation of the Subject
Property, which is authorized by HSC section 17980, subdivision (b), would be too speculative for the
City to undertake and too costly for the City to bear. City-initiated construction projects are subject to a
variety of standards and requirements, such as competitive bidding requirements and prevailing wage
policies that are not faced by private developers. The City is not in the business of rehabilitating private
property and simply does not have sufficient resources or discretion to manage the rehabilitation of all
substandard properties in the City.
Eminent domain is also not a viable alternative. (See City and County of San Francisco v. Daley
(1993) 16 Cal.App.4th 734, 745.) Exercise of the City’s eminent domain powers to acquire substandard
private properties is time consuming and costly, both in terms of acquisition costs and legal costs.
Furthermore, the use of eminent domain in this case would undercut the public policy that property
owners should be responsible for maintaining safe and habitable properties. For these reasons, the State
Legislature has expressly provided for receiverships pursuant to HSC section 17980.7, subdivision (c),
which is the most appropriate remedy in this case.
///
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C. The Proposed Court Receiver Is Capable of Carrying out the Duties of a Receivership
and Must Be Allowed to Perform Those Duties Without Interference by the Defendant
1. The Proposed Court Receiver Has Demonstrated the Necessary Capacity
and Expertise to Develop and Supervise a Viable Rehabilitation Plan
As the City has met the first factor warranting the appointment of a receiver by showing that the
Defendant Owners have had more than a reasonable opportunity to correct the violations identified in
the N&O, the only factor left for the City to establish is that its proposed court receiver has the necessary
capacity and expertise to develop and supervise a viable rehabilitation plan for the Subject Property.
(HSC, § 17980.7, subd. (c)(2); City of Desert Hot Springs v. Irene Valenti, supra, 43 Cal.App.5th at p.
794.)
The City has nominated Kevin A. Singer as the Court Receiver to plan and oversee the
rehabilitation of the Subject Property. Mr. Singer has extensive experience as a court receiver, having
successfully served as a court receiver or referee in more than 500 cases. (See Declaration of Kevin A.
Singer (“Singer Decl.”), Ex. A.) Mr. Singer, a California licensed attorney, Real Estate Broker, and
General Contractor, has the necessary expertise both in terms of managing residential properties and
generally performing the duties of a receiver. (Singer Decl., ¶¶ 1–4, Ex. A.) As evidenced by his
substantial work as a court receiver in other cases, Mr. Singer has the experience and commitment to
this project which is needed to rehabilitate the Subject Property and restore its market value. (Singer
Decl., ¶¶ 3, 4 Ex. A.) Mr. Singer has reviewed the conditions of the Subject Property and determined
that receivership is appropriate in this case. (Singer Decl., ¶¶ 5, 6.) Thus, the City has met the second
requirement for the appointment of a court receiver.
2. Defendant Owners and Those Acting for Them Must Be Enjoined from
Interfering with the Court Receiver’s Rehabilitation of the Subject Property
HSC section 17980.7, subdivision (c)(3), provides:
If a receiver is appointed, the owner and his or her agent of the substandard building shall
be enjoined from collecting rents from the tenants, interfering with the receiver in the
operation of the substandard building, and encumbering or transferring the substandard
building or real property upon which the building is situated.
The City requests that, upon the appointment of a court receiver, Defendant Owners and those
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acting for them be enjoined from committing the acts described above, as such conduct will inhibit the
court receiver in his duties.
3. The Court Receiver Should Be Authorized to Secure the Debts of the
Receivership Estate with Super Priority Liens on the Subject Property
The City requests that the court receiver be authorized to fund the receivership estate with super-
priority liens used to pay the expenses of the receivership estate, the property management and
maintenance expenses, rehabilitation costs, the receiver’s fees, and the City’s costs, expenses, and
attorneys’ fees.
The court receiver will borrow funds by issuing “receiver’s certificates” to project lenders. The
certificates will act as both promissory notes to evidence the debts, and as deeds of trust on the Subject
Property securing payment of the debts. The certificates that the court receiver will be authorized to
issue will be subject to further orders of this Court. HSC section 17980.7, subdivision (c)(4)(G),
authorizes a court receiver to borrow funds to rehabilitate a receivership property and, with court
approval, to secure that debt with a lien on the receivership property. Case law and principles of equity
further authorize the equitable prioritization of the receivership liens over all pre-existing encumbrances.
(City of Sierra Madre v. Suntrust Mortgage (2019) 32 Cal.App.5th 648; see also City of Riverside v.
Horspool (2014) 223 Cal.App.4th 670; Title Ins. & Trust Co. v. California Development Co. (1915) 171
Cal. 227.)
Although various liens exist on title, the above cases demonstrate that priority of the receiver’s
liens is appropriate. To rule otherwise would make the HSC section 17980.7, subdivision (c),
receivership unworkable because it would be financially infeasible for court receivers to take on the
work if there was doubt that the liens would be paid. Without utilizing the HSC section 17980.7,
subdivision (c), remedy, the City would be unable to address such problematic properties and have
continued public safety concerns. Accordingly, the Court’s receiver should be authorized to secure the
debts of the receivership estate with super-priority liens.
D. The City Is Entitled to Recover Its Expenses, Costs, and Fees Associated with this
Action Out of the Receivership Estate
Cities are statutorily entitled to recover their inspection costs, investigation costs, enforcement
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costs, court costs, and attorneys’ fees in receivership actions. (HSC, §§ 17980.7, subds. (c)(4)(G),
(c)(11), (d)(1).) HSC section 17980.7, subdivision (c)(4)(G), expressly authorizes a court receiver,
subject to the Court’s approval, to secure “any moneys owed to the enforcement agency. . . with a lien
on the real property upon which the substandard building is located.” (HSC, § 17980.7, subd. (c)(4)(G).)
Furthermore, in all nuisance abatement actions, cities are statutorily entitled to recover their costs
through special assessments that become a personal obligation of the property owner and a super-priority
lien on the property. (Gov. Code, §§ 38773.5, 53935; Rev. & Tax. Code, § 2192.1.)
Similar to court receivers, cities’ efforts to inspect properties, issue correction notices and orders,
initiate receivership actions, and bear the costs of receivership litigation, are directly related to the
rehabilitation of receivership properties. Without those efforts, a court receiver would not be appointed,
and the dangerous conditions would not be abated. Thus, the same reasoning and rationale supporting
the right of court receivers to record receivership debts as super-priority liens also applies to the right of
cities to collect their expenses, costs, and attorneys’ fees out of the receivership estate. Indeed, in
Winslow v. Harold Ferguson, the Court expressly found that “the expense incurred by a litigant for legal
services in causing the appointment of a receiver is as much an expense of administrator as the charge
of the receiver’s counsel and should have priority to the same extent.” (Winslow v. Harold Ferguson
(1944) 25 Cal. 2d 274, 284–85; See also City of Santa Paula v. Narula (2003) 114 Cal.App.4th 485, 493
[“There is a strong public policy to encourage [cities] to abate nuisances and provide attorney fees to
help defray the costs of such actions.”].)
It is equitable and efficient to authorize recovery of the City’s receivership action related
expenses, costs, and attorneys’ fees to be paid directly out of the receivership estate since such debts are
already authorized to be secured as super-priority liens on the receivership property.
E. Alternative Relief for Request for an Order to Shorten Time
Alternatively, the City requests an order shortening the time for the City to obtain a hearing on
the City’s Ex Parte Application on the Court’s regularly noticed motion calendar. (Cal. Rule of Court,
rule 3.1300; Code Civ. Proc., §§ 128, 1005(b).)
IV. CONCLUSION
The City has clearly established that Defendant Owners had more than a reasonable opportunity
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1 to correct the violations identified in the N&O.The City has also established that its proposed court
2 receiver has the capacity and expertise needed for this appointment.Accordingly,as the City has met
3 the only two factors that the Court can consider in determining whether the appointment of a receiver is
4 warranted,the City respectfully requests that the Court appoint Court Receiver Kevin A.Singer as the
5 Court's receiver over the Subject Property.
The Subject Property is hazardous and a threat to the safety of the public.In order to safeguard
7 the welfare of the community and cure the dangers posed by the Subject Property,the appointment of a
6
8 court receiver is not only appropriate,but immediately necessary.
9
10 Dated:March 9,2026 CIVICA LAW GRouP,APC
By:12
Attorneys for Plaintiff
CITY OF SAN LUIS OBISPO
MA
SEA :
NICHOLAS GARCES
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